Question

A credit card advertises an annual interest rate of 23%. What is the equivalent monthly interest rate?

Answer 1

23/12 = 1.916666667 ( they use all decimal points actually so they get all the money they can. :)

Answer 2

1.916% or approx 1.92%

Explanation:

A credit card advertises an annual interest rate of 23%.

Annual rate of interest means rate of interest offered for 12 months.

So, if you have to calculate the monthly rates, you can divide the given rate by 12.

So, monthly rate is =
`23/12=1.916`% ≈ 1.92%