Dory needs money in order to keep on swimming, but her credit is poor.  She runs into Bruce, a loan shark (who despite being a potential exploiter of fish, doesn't eat them).  Bruce offers to lend Dory some clams (which for some reason is English slang for money) at an interest rate of 0.27% per day (i.e. daily compounding).  Being a loan shark, as well as a resident of the sea, Bruce is not required to report the APR of this loan.  Assume that Dory has run into Bruce in a regular year (not a leap year) with 365 days.

 If Dory borrows from Bruce, what effective annual rate will she be paying?

Answer rating: 100% (QA)

To calculate the effective annual rate EAR of the loan we can use the ... View the full answer