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Calculate the cost in dollars bondoc co ltd will charge

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Question - Debt and Credit Management - Jack is a 40-year-old man who lives in a Mississauga apartment he owns. He has lately lost his job and he's currently on unemployment benefits. To make matters worse, his automobile broke down, requiring $1,500 in repairs. He's thinking about taking out a payday loan from Bondoc Co. Ltd. which offers payday loans for a flat fee of $15 per loan plus 12% of principal, for up to 28 days. Jack wants to borrow $1,500 for 25 days from the company.

Required -

(a) Calculate the cost in dollars Bondoc Co. Ltd. will charge.

(b) Calculate the EAR Bondoc Co. Ltd. will charge.

(c) A payday loan might not be the best option for Jack. (1) Explain why and (2) suggest another alternative to the payday loan for Jack.

Reference no: EM133166064

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