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If a pawnbroker loans me 1080 and 1 month later i pay back 1170 what annual interest rate did i pay

1 Answer

7 votes

Answer:

10%

Explanation:

The interest paid is the difference between the amount borrowed and the amount paid back. In this case, the amount borrowed is 1080 and the amount paid back is 1170, so the interest paid is:

1170 - 1080 = 90

Now we need to determine the annual interest rate. Since the loan was for one month, we need to convert the interest paid to an annual rate.

To do this, we can use the formula:

annual interest rate = (interest paid / amount borrowed) x (12 / loan term in months)

In this case, the loan term is 1 month, so we can substitute the values:

annual interest rate = (90 / 1080) x (12 / 1) = 0.10 or 10%

Therefore, you paid an annual interest rate of 10%.

answered
User Darethas
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