Your credit card company quotes you a rate of 14.9%. Interest is billed monthly. What is the actual rate of interest you are paying?

Name: Your credit card company quotes you a rate of 14.9%. Interest is billed monthly. What is the actual rate of interest you are paying?
Brand: Quizplus
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Question

Quizplus · Accepted Answer

The actual rate of interest is calculated using the formula: (1 + (quoted rate / 12))^12 - 1. In this case, the actual rate of interest is (1 + (0.149 / 12))^12 - 1 = 0.1596, or 15.96%.

Your Credit Card Company Quotes You a Rate of 14