Using the Merchant's rule,a debt of $4000 is paid off as follows: $2000 in 50 days and a final payment of $2026.51 in 80 days from today.What simple interest rate,r,was used? A)r

Question

Using the Merchant's rule,a debt of $4000 is paid off as follows: $2000 in 50 days and a final payment of $2026.51 in 80 days from today.What simple interest rate,r,was used?
A)r < 3.0%
B)3.0% < r < 3.5%
C)3.5% < r < 4.0%
D)r > 4.0%

Quizplus · Accepted Answer

The Merchant's rule calculates the interest rate by considering the time-weighted payments. Solving for r using the given payments and time periods results in a rate between 3.5% and 4.0%.

Using the Merchant's Rule,a Debt of $4000 Is Paid Off