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Chapter 29: Problem 19

If there were no usury law, the interest rate would be percent. (LO4) a) 16 d) 22 b) 18 e) 24 c) 20

Short Answer

Expert verified
In conclusion, it is impossible to determine a specific interest rate without usury laws based on the information provided. More context or information would be needed to correctly answer the question. The possible interest rates provided (16%, 18%, 20%, 22%, and 24%) could all potentially be correct without additional information.

Step by step solution

01

Understanding Usury Laws

Usury laws are laws that define the maximum interest rate that can be charged on loans or other financial transactions. If these laws were not in place, the interest rate is likely to be higher than the limits set by these laws.
02

Evaluating the Possible Interest Rates

The exercise does not give us enough information to determine the specific interest rate without usury laws. However, we can evaluate and compare the given options: a) 16%, b) 18%, c) 20%, d) 22%, and e) 24%. Without any additional context, any of these interest rates could potentially be the rate if there were no usury law. The answer would depend on the specific economy and financial market in question.
03

Acknowledging the Limitations of the Exercise

As it is impossible to determine a specific interest rate without usury laws based on the information provided, it is important to acknowledge the limitations of the exercise. In conclusion, to correctly answer the question and determine the interest rate without usury laws, more context or information would be needed. The possible interest rates provided could all potentially be correct without additional information.

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Most popular questions from this chapter

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