your friend tells you that if you let her keep 20 of your pokemon cards for three months, she will give you…

your friend tells you that if you let her keep 20 of your pokemon cards for three months, she will give you 2 cards extra when she returns your cards to you. what is the annual rate of interest she is willing to pay for the borrowed cards? note: even though she only keeps your cards for three months, we can still calculate an annual interest rate.

your friend tells you that if you let her keep 20 of your pokemon cards for three months, she will give you 2 cards extra when she returns your cards to you. what is the annual rate of interest she is willing to pay for the borrowed cards? note: even though she only keeps your cards for three months, we can still calculate an annual interest rate.

Answer

Explanation:

Step1: Determine the interest for 3 - month period

The principal number of cards is $P = 20$, and the interest for 3 - month period is $I=2$.

Step2: Calculate the number of 3 - month periods in a year

There are $n=\frac{12}{3}=4$ three - month periods in a year.

Step3: Calculate the annual interest

Since the interest for 3 months is 2 cards, the annual interest $I_{annual}=2\times4 = 8$ cards.

Step4: Calculate the annual interest rate

The annual interest rate $r$ is calculated using the simple - interest formula $r=\frac{I_{annual}}{P}\times100%$. Substituting $I_{annual} = 8$ and $P = 20$ into the formula, we get $r=\frac{8}{20}\times100%=40%$.

Answer:

40%