You need 400 badly and decide to write a check at a check ca

You need $400 badly, and decide to write a check at a check cashing place to get that money. Assuming you much write the check for $500 to get the $400 in cash, and the check will be cashed in 2 weeks, what simple interest rate did you just pay? Assume 52 weeks in a year for this problem

Solution

$100 interest on $400 = (100/400) x 100 = 25%
25% for 2 weeks = 50%

then for 26 week = (50/2)% x 26 = 650% interest/year