First we have to calculate the amount of interest. This can be done by using the interest formula, I = P x R x T.
= 25,000 x 0.13 x (100/365)
= 902.78
This will be deducted from the principal amount, which is 25,000.
= 24,097
Last, we plug our values in to the effective rate formula for interest:
[tex] \frac{Interest}{Proceeds x Time of Note} [/tex]
902.78/6693.6722
= 13.487066
After rounding, we come to our final answer, which is D, 13.49%.
