Abbassi's mother has just been diagnosed with a serious illness requiring immediate treatment. the hospital is asking for a down payment of $400 000 before her treatment can begin. Abbassi's family has agreed to cover all medical costs, but it will take them a few months to organize the funds. abbassi has therefore borrowed $4000 000 from Lendz Ltd, a payday lender, expecting to repay within three months. Lendz Ltd charges 35% per annum, compounded weekly. what rate of interest is Abbassi paying? Abbassi could obtained a loan from Fly By Nite, however he felt that the rate of a rate of interest of 38%, compounded monthly meant that the payday lender was a better option.
Is Abbassi correct in this belief?