Question

Big Dom's Pawn Shop charges an interest rate of 21 percent per month on loans to its customers. Like all lenders, Big Dom must report an APR to consumers. What is the APR for Big Dom's Pawn Shop?

Answer 1

The APR for Big Dom's Pawn Shop is 252%.

Step-by-step explanation:

The APR for Big Dom's Pawn Shop can be calculated by determining the annual interest rate equivalent to the monthly interest rate of 21%. To calculate the APR, we multiply the monthly interest rate by 12 to get the annual interest rate.

APR = Monthly Interest Rate x 12

APR = 21% x 12 = 252%.