Question

Reca was approved for a credit card that charges an apr of 26% what is her monthly interest rate?

Answer 1

Answer:

$i_m=0.01945$ or 1.945%

Step-by-step explanation:

Term annual percentage rate(APR) is the annual interest rate charged ona financial year for a duration of one year. APR can be converted to weekly, monthly, daily or even semi-annual rates using the below formula.

Effective rate for period = (1 + annual rate)(1 / n of periods) – 1

Rate is given as:

$i_m=(1+i)^\frac{1}{12}-1\\i_m=(1+0.26)^\frac{1}{12}-1\\i_m=0.01945$