Question

Based on a $500 loan amount, rank the following companies from the lowest to highest annual percentage rate (APR). Company Fees Charged Term of Loan A $60 20 days B $50 12 days C $75 15 days D $100 8 days

Answer 1

A.) A, B, C, D

Step-by-step explanation:

Just took the test ;-;

Answer 2

Given:
Loan amount = 500
Company Fees Charged Term of Loan
A $60 20 days
B $50 12 days
C $75 15 days
D $100 8 days

To solve for APR:
1) Divide charged fee by the loan amount
2) Multiply the result by 365
3) Divide the product by the term of the loan
4) Multiply the quotient by 100%.

Company
A: 60/500 = 0.12 * 365 = 43.8 ÷ 20 = 2.19 * 100% = 219%
B: 50/500 = 0.10 * 365 = 36.5 ÷ 12 = 3.04 * 100% = 304%
C: 75/500 = 0.15 * 365 = 54.75 ÷ 15 = 3.65 * 100% = 365%
D: 100/500 = 0.20 * 365 = 73 ÷ 8 = 9.125 * 100% = 912.5%