Karla Kaufmann borrowed $750 at 12 percent for one year. She paid a $20 processing fee.
The interest paid will be $
.
Thus, the total finance charge (the interest plus the processing fee) will be $
Therefore, to the nearest tenth, the APR = total finance charge ÷ amount borrowed =
%.
To calculate the interest paid, we need to find 12% of $750.
Interest = (12/100) * $750 = $90
Next, we add the $20 processing fee to the interest paid to find the total finance charge.
Total finance charge = $90 + $20 = $110
To calculate the Annual Percentage Rate (APR), we divide the total finance charge by the amount borrowed.
APR = (Total finance charge / Amount borrowed) * 100
APR = ($110 / $750) * 100 = 14.7%
Therefore, the interest paid will be $90, the total finance charge will be $110, and the APR to the nearest tenth is 14.7%.