Question

Jim Tree borrowed $1,000 at 10 percent for one year. He paid a $45 processing fee and $100 in interest. Thus, the finance charge is $145, the interest plus the application fee. What is the APR for this loan? APR (to the nearest tenth) = 1.4 1.5 13.7 14.5

Answer 1

Answer:14.5

Step-by-step explanation:

Answer 2

Answer:

The answer is 14.5%.

Step-by-step explanation:

Jim Tree borrowed $1,000 at 10 percent for one year.

He paid a $45 processing fee and $100 in interest making a total of $145.

We have to find the APR for this loan.

APR can be found by :

APR = Finance charge/Amount borrowed

APR =$145/1000$ =0.145

And multiply by 100 to get percentage.

$0.145\times100=14.5$%

Therefore, the answer is 14.5%.