A man offers seven-for-eight loans to his friends. That is, he lends seven dollars today and gets

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A man offers seven-for-eight loans to his friends. That is, he lends seven dollars today and gets eight dollars back in one week. What is the annual rate his friends are effectively paying him for the loans?

First, compute return over 1 week.

Related Book For answer-question

Foundations of Financial Management

ISBN: 978-1259024979

10th Canadian edition

Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta

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Posted Date: Apr 08, 2024 02:36 PM

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A man offers seven-for-eight loans to his friends. That is, he lends seven dollars today and gets

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Expert Answer:

To compute the return over one week for the loan we can calculate the simple interest earned by the ... View the full answer

Foundations of Financial Management

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