You get a 180-day $3,000 consumer loan at 9% interest You are required to pay a $100 setup fee at the time you get the loan. Based on a 365-day year, calculate the APR. Express the rate to the nearest tenth of a percent.

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Mathematics

Lukas

29 August, 13:10

You get a 180-day $3,000 consumer loan at 9% interest You are required to pay a $100 setup fee at the time you get the loan. Based on a 365-day year, calculate the APR. Express the rate to the nearest tenth of a percent.

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Karly Grimes · Answer 1

The interest on the loan is

... I = P*r*t = 3000*.09*180/365 = 133.15

Your effective rate is

... r = I / (Pt) = (100 + 133.15) / (3000*180/365) = 15.8%