Civil Service Exam Reviewer · Simple Interest and Profit/Loss · hard
A 1-year loan of ₱270,000 has its 12% interest deducted in advance. What is the effective (true) interest rate on the money received?
- 12%
- 18%
- 13.64%
- 12.64%
Answer
C. 13.64%
Solution
Proceeds = ₱237,600. Effective rate = 32,400 ÷ 237,600 = 13.64%.
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