A cheque-cashing store is in the business of making personal loans to walk-up customers. The store makes only one-week loans at 8% interest per week.

a. What APR must the store report to its customers? What EAR are customers actually paying? (Do not round the intermediate calculations. Round the final EAR answer to 2 decimal places. )

Annual percentage rate	4 Numeric Response 1.Edit Unavailable. 4 incorrect.%
Effective annual rate	53.71 Numeric Response 2.Edit Unavailable. 53.71 incorrect.%

b. Now suppose the store makes one-week loans at 8% discount interest per week. Whats the APR now? The EAR? (Do not round the intermediate calculations. Round the final answers to 2 decimal places.)

Annual percentage rate	4.52 Numeric Response 3.Edit Unavailable. 4.52 incorrect.%
Effective annual rate	75.54 Numeric Response 4.Edit Unavailable. 75.54 incorrect.%

c. The cheque-cashing store also makes one-month add-on interest loans at 8% discount interest per week. Thus if you borrow $100 for one month (four weeks), the interest will be ($100 1.08⁴ ) 100 = $36.05. Because this is discount interest, your net loan proceeds today will be $63.95. You must then repay the store $100 at the end of the month. To help you out, though, the store lets you pay off this $100 in installments of $25 per week. What is the APR of this loan? What is the EAR? (Do not round the intermediate calculations. Round the final answers to 2 decimal places.)

Annual percentage rate	8.71 Numeric Response 5.Edit Unavailable. 8.71 incorrect.%
Effective annual rate	3,142.10 Numeric Response 6.Edit Unavailable. 3,142.10 incorrect.%