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Jim is considering getting a payday loan so he can buy a new shirt to look cool this weekend. Help him understand the effective interest

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Jim is considering getting a payday loan so he can buy a new shirt to look cool this weekend. Help him understand the effective interest rate that the different lenders are offering him. The Effective interest Rate of Payday Loans The formula for effective interest rate is effective interest rate = left) = (1-2)-1 where ris the APR and n is the number of periods in a year Bad Loans Inc. is offering Jim a $400 loan maturing in 2 weeks for a fee of $120 1. What is the effective interest rate of this loan? Assume there are 52 weeks in a year 9 of 13 NEXT > FREVIOUS

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