Carol Miller went to Europe and forgot to pay her $800 mortgage payment on her N
ID: 2737269 • Letter: C
Question
Carol Miller went to Europe and forgot to pay her $800 mortgage payment on her New Hampshire ski house. For her 72 days overdue on her payment, the bank charged her a penalty of $16. What was the rate of interest charged by the bank? (Use 360 days a year. Do not round your intermediate calculations. Round your answer to the nearest hundredth percent.)
Carol Miller went to Europe and forgot to pay her $800 mortgage payment on her New Hampshire ski house. For her 72 days overdue on her payment, the bank charged her a penalty of $16. What was the rate of interest charged by the bank? (Use 360 days a year. Do not round your intermediate calculations. Round your answer to the nearest hundredth percent.)
Explanation / Answer
Answer:
Interest Charged=10%
Working notes for the above answer is as under
I = Po*(r/360)*t = $16
800(r/360)*72 = 16
57600r/360 = 16
160r = 15
r = 0.100 = 10%/yr.
10%