Monday, December 21, 2009

I am horrible at word problems. Can someone explain how to figure this out?

Eddie wrote a $ 280 check to a check holding company, which gave him $ 260 in cash. After two weeks the company will cash his $ 280 check. Find the annual simple interest rate for this loan. Note that the time is a fraction of a year.I am horrible at word problems. Can someone explain how to figure this out?
280 - 260 = 20





interest i = 20/260





i = 1/13 in two weeks





i = 1/13/2*52 = 200% per year

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