What is the compound annual rate implied by percent rate

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Problem 1: Payday loans are very short-term loans that charge very high interest rates. You can borrow $500 today and repay $575 in two weeks. What is the compound annual rate implied by this 15 percent rate charged for only two weeks?

Problem 2: Payday loans are very short-term loans that charge very high interest rates. You can borrow $200 today and repay $225 in two weeks. What is the compound annual rate implied by this 12.5 percent rate charged for only two weeks?

Problem 3: What is the interest rate of a 4-year, annual $1,000 annuity with present value of $3,500?

Problem 4: Mr. Jones decides to purchase a car for $10,000. The dealer offers to finance the car at 8% interest over a 4 year period. What is the payment amount that Mr. Jones would be expected to pay?

Reference no: EM132663573

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