document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1173057>Question 1173057</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Calculate the daily and annual rate of interest charged on a payday loan of $400 if the interest charged was $35 when it was paid back 6 days later. </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #798430 by </B><A HREF=/tutors/aboutme.mpl?userid=Theo><B>Theo(13342)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Theo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=Theo><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=798430\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> the payday loan was for 400 dollars.<BR>\n" );
document.write( "the charge was 35 when the loan is paid back 6 days later.\r<BR>\n" );
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document.write( "these types of loans are usually assumed to be simple interest type loans.\r<BR>\n" );
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document.write( "the formula for a simple interest loan would be:\r<BR>\n" );
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document.write( "i = p * r * t\r<BR>\n" );
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document.write( "i is the interest<BR>\n" );
document.write( "p is the principal<BR>\n" );
document.write( "r is the interest rate per time period<BR>\n" );
document.write( "t is the number of time periods.\r<BR>\n" );
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document.write( "in this problem:\r<BR>\n" );
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document.write( "i = 35<BR>\n" );
document.write( "p = 400<BR>\n" );
document.write( "t = 6 days\r<BR>\n" );
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document.write( "the formula becomes:<BR>\n" );
document.write( "35 = 400 * r * 6<BR>\n" );
document.write( "solve for r to get:<BR>\n" );
document.write( "r = 35 / (400 * 6) = .0145833333 per day.\r<BR>\n" );
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document.write( "confirm this value of r is correct by replacing r in the formula used to get:<BR>\n" );
document.write( "35 = 400 * .0145833333 * 6 = 35, confirming the value of r is good.\r<BR>\n" );
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document.write( "that value for r is per day.\r<BR>\n" );
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document.write( "assuming a year is equal to 365 days, then r per year would be equal to 365 * .0145833333 = 5.32291666 = 532.291666%.\r<BR>\n" );
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document.write( "that's over 500% interest rate per year.\r<BR>\n" );
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document.write( "your solution is:\r<BR>\n" );
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document.write( "the daily interest rate charge is .0145833333 = 1.45833333% per day.\r<BR>\n" );
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document.write( "the yearly interest rate charge would be .0145833333 * 365 = 5.322916667 = 532.2916667% per year.\r<BR>\n" );
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document.write( "rounded your percentages to 2 decimal places and you get:\r<BR>\n" );
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document.write( "interest rate charge is 1.46% per day.<BR>\n" );
document.write( "interest rate charge is 532.29% per year\r<BR>\n" );
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document.write( " </SPAN>\n" );
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