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A payday loan company charges 4.25 percent interest for a two-week period. What is the annual interest rate

Sagot :

The annual interest rate is  195.1%.

What is interest rate?

Interest rate is the cost of borrowing. It is the amount the borrower pays the lender for the use of the lender's funds.  Interest rate increases the amount borrowed by the interest rate.

What is the annual interest rate?

Annual interest rate = (1 + biweekly interest rate) ^number of compounding - 1

Number of compounding = 52 / 2 = 26

(1.0425)^26 - 1 = 195.1%

To learn more about  interest, please check: https://brainly.com/question/26367706

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