Question

Jamie has applied for a credit card. The APR of the card is 20%. What will be the monthly interest rate?

Answer 1

apr means annual percentage rate and there are 12 months in a year so:

20/12 = 1.67%

Answer 2

1.67%

Explanation:

The APR of a card is the Annual Percentage Rate. This is the yearly rate of interest that a person has to pay on the money he or she borrowed. Interest is a price that is paid for borrowing money. In this case, if the APR is 20%, we would need to divide this number by the number of months in a year in order to get the monthly interest rate:

20 / 12 = 1.67 %