Business, 20.03.2020 04:51 mvazquez298

A check-cashing store is in the business of making personal loans to walk-up customers. The store makes only one-week loans at 7.9 percent interest per week. a. What APR must the store report to its customers? What EAR are customers actually paying? (Round your answers to 2 decimal places. (e. g., 32.16)) Annual percentage rate 410.8 % Effective annual rate 5113.33 % b. Now suppose the store makes one-week loans at 7.9 percent discount interest per week. What’s the APR now? The EAR? (Round your answers to 2 decimal places. (e. g., 32.16)) Annual percentage rate 446.14 % Effective annual rate 7126.23 % c. The check-cashing store also makes one-month add-on interest loans at 7.9 percent discount interest per week. Thus if you borrow $220 for one month (four weeks),the interest will be ($220 × 1.0794 ) – 220 = $78.20. Because this is discount interest, your net loan proceeds today will be $141.80. You must then repay the store $220 at the end of the month. To help you out, though, the store lets you pay off this $220 in installments of $55 per week. What is the APR of this loan? What is the EAR? (Round your answers to 2 decimal places. (e. g., 32.16))

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A check-cashing store is in the business of making personal loans to walk-up customers. The store ma...

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