What is the annual interest rate for a 90-day note issued with a face value of $8,000 that will earn interest of $160?Select answer from the options below4%16%12%8%
Question
What is the annual interest rate for a 90-day note issued with a face value of 160?Select answer from the options below4%16%12%8%
Solution
To find the annual interest rate, we first need to find the interest rate for the 90-day period. We can do this by dividing the interest earned by the face value of the note:
8000 = 0.02 or 2%
However, this is the interest rate for a 90-day period. To find the annual interest rate, we need to multiply this by the number of 90-day periods in a year (which is 4):
2% * 4 = 8%
So, the annual interest rate is 8%.
Similar Questions
An investment offers to pay $100 a year forever starting at the end of year 6. If the interest rate is 8%, what is the investment's value today?
What is the present value of an investment that pays you $1,200 in 5 years’ time where annual interest rates are 8% compounded annually?
A private investor loans $4,500 to a new business at an annual interest rate of % for 8 years. How much interest will the investor earn after those 8 years?
How much would $200 invested at 4% interest compounded monthly be worth after 8 years? Round your answer to the nearest cent.𝐴(𝑡)=𝑃(1+𝑟𝑛)𝑛𝑡A(t)=P(1+ nr ) nt A.$205.40B.$322.83C.$273.71D.$275.28SUBMITarrow_backPREVIOUS
a piece of machinery can be bought for 200000 cash or for 20000 down and payments of 20000 per year for 15 years. what is the annual interest rate of the time payments?
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.