Dam borrowed K3600 and pays a fortnightly interest of K27. Calculate the yearly interest rate?
To calculate the yearly interest rate, we need to determine the total interest paid in one year.
Since the interest is paid fortnightly, we need to calculate the interest paid for one fortnight and then multiply it by the number of fortnights in a year.
Given that the loan amount is K3600 and the fortnightly interest is K27, the total interest paid in one fortnight is K27.
Now, let's calculate the number of fortnights in a year. There are 52 weeks in a year, and since a fortnight is two weeks, there are 52/2 = 26 fortnights in a year.
Multiplying the fortnightly interest by the number of fortnights in a year, we get:
K27 * 26 = K702
The total interest paid in one year is K702.
To calculate the yearly interest rate, we divide the total interest by the loan amount and then multiply by 100 to get the percentage:
(K702 / K3600) * 100 = 19.5%
Therefore, the yearly interest rate is 19.5%.
To calculate the yearly interest rate, we need to first determine the amount of interest paid in a year.
Since the interest is paid fortnightly, we can find the annual interest by multiplying the fortnightly interest by the number of fortnights in a year.
To calculate the number of fortnights in a year, we divide the total number of weeks in a year by 2:
Number of fortnights in a year = Number of weeks in a year / 2
There are typically 52 weeks in a year, so:
Number of fortnights in a year = 52 / 2 = 26 fortnights
Now, we can calculate the annual interest:
Annual interest = Fortnightly interest * Number of fortnights in a year
Annual interest = K27 * 26 fortnights
Annual interest = K702
Now, to find the yearly interest rate, we divide the annual interest by the amount borrowed:
Yearly interest rate = Annual interest / Amount borrowed
Yearly interest rate = K702 / K3600
Yearly interest rate ≈ 0.195 or 19.5%
Therefore, the yearly interest rate is approximately 19.5%.