Many tax preparation firms offer their clients a refund anticipation loan (RAL). For a fee, the firm will give a client his refund when the return is filed. The loan is repaid when the IRS refund is sent to the firm. The RAL fee is equivalent to the interest charge for a loan. The schedule in Table 4 is from a major RAL lender. Use this schedule to find the annual rate of interest for the RALs in Problem

A client receives a $1,900 RAL, which is paid back in 15 days.

Transcribed Image Text:

Table 4 RAL Amount RAL Fee $0-$500 $29.00 $501-$1,000 $39.00 $1,001-$1,500 $49.00 $1,501-$2,000 $69.00 $2,001-$5,000 $89.00