Interest Is $405 on a Principal Balance of $5,000; Assuming

question 50

Short Answer

Interest is $405 on a principal balance of $5,000; assuming a 7 month loan, what is the rate? Round to the nearest cent or hundredth percent as needed.

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Definitions:

Taxes

Obligatory financial impositions or another sort of tax placed on individuals by government institutions designed to support government expenditure and multiple public financial needs.

Expansionary Monetary Policy

A form of macroeconomic policy that aims to increase the money supply and typically lower interest rates to stimulate economic growth.

Discount Rate

The rate at which central banks lend to commercial banks or other financial institutions.

Government Securities

Financial instruments issued by the government to finance its expenditures, including bonds, bills, and notes, which are considered low-risk investments.