Question

What is the periodic interest rate for an account that is billed monthly with an apr of 18.99%?Round your answer to the nearest hundredth

Answer 1

Given:

The APR is 18.99%

Find-:

What is the periodic interest rate for an account that is billed monthly?

Explanation-:

The APR is calculated by dividing the APR by the number of periods it is to be converted to.

If, for instance, a monthly periodic rate is needed, divide APR by 12 as there are 12 months in a year.

So, the billed monthly are:

$\begin{gathered} =\frac{APR}{12} \\ \\ =\frac{18.99\%}{12} \\ \\ =1.5825 \\ \\ \approx1.58\% \end{gathered}$

The monthly bill is 1.58%