Question

Saul paid off a loan with a simple interest rate of 4.7% in 9 months. What was the APR?

6.4%
8.5%
3.5%
6.3%
4.7%

Answer 1

The APR in this scenario is 4.7%.

Step-by-step explanation:

To find the APR (Annual Percentage Rate) in this scenario, we need to understand the relationship between APR and simple interest rate. The simple interest rate is the nominal rate for a specific time period, while the APR represents the annualized interest rate, taking into account compounding. As the loan in the question has a simple interest rate of 4.7%, the APR would also be 4.7% since there is no compounding involved. Therefore, the correct option is 4.7%.