How much do you need to subtract from 77/10 to make 7
2 answers:
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Answer:
Ans. A) The annual rate that the company charged was 11.996%; B) if they charged you 11.186% annual rate, you would have to pay $41.14
Step-by-step explanation:
Hi, first we have to find out what is the effective 119 days rate and then turn it into an annual rate. This is as follows.
So the charged rate was 3.816% effective, 119 days, now let´s make it an annual rate.
This means that the equivalent rate to 3.816% effective 119 days ys 11.996% effective annually (or just annual).
Now, if they were to charge you 11.186% annual, you would have to make this rate effective 119 days, and then, multiply it by the principal ($1,153). Let´s change the rate first.
And the money that you will have to pay in interest is $1,153*0.03568=$41.14
Best of luck