Question

Reca was approved for a credit card that charges an apr of 26% what is her monthly interest rate?

Answer 1

`i_m=0.01945` or 1.945%

Explanation:

Term annual percentage rate(APR) is the annual interest rate charged ona financial year for a duration of one year. APR can be converted to weekly, monthly, daily or even semi-annual rates using the below formula.

Effective rate for period = (1 + annual rate)(1 / n of periods) – 1

Rate is given as:

`i_m=(1+i)^(1)/(12)-1\\i_m=(1+0.26)^(1)/(12)-1\\i_m=0.01945`