E-Z Loans is offering a special on one-year loans.The company will loan you $1,500 today with no waiting and no credit check, in exchange for one payment of $2,000 one year from now.What is the APR on this loan?

Question

Quizplus · Accepted Answer

The APR (Annual Percentage Rate) is calculated as the interest paid divided by the principal, then multiplied by 100 to convert it to a percentage. Here, the interest is $500 ($2,000 - $1,500), and the principal is $1,500. So, APR = ($500 / $1,500) * 100 = 33.33 percent.

E-Z Loans Is Offering a Special on One-Year Loans