Your friend is short on cash and thinking about using one of those payday loan places. You

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Your friend is short on cash and thinking about using one of those payday loan places. You told him it's a bad idea and you are explaining why.

The loan is for $850 and it will be paid back 11 days later. He will have to pay them back $1400. Assume the company compounds every 11 days.

2a. What is the effective interest rate per year?

2b. What would you owe if you kept the money for 1 year?

Related Book For answer-question

Contemporary Business Mathematics With Canadian Applications

ISBN: 9780135285015

12th Edition

Authors: Ali R. Hassanlou, S. A. Hummelbrunner, Kelly Halliday

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Posted Date: May 08, 2024 01:19 PM

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Your friend is short on cash and thinking about using one of those payday loan places. You

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Why Payday Loans Are a Bad Idea An Example Lets break down why payday loans are a bad idea using your friends situation 2a Effective Interest Rate per ... View the full answer

Contemporary Business Mathematics With Canadian Applications

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