Jim Tree borrowed $1,000 at 10 percent for one year. He paid a $45 processing fee and $100 in interest. He calculated the APR to the nearest tenth. What was the APR?

APR or Annual Percentage Rate is the true cost of borrowing and it considers the interest and processing fees both, for calculating the cost of the loan.Jim Tree borrowed $1,000 at 10 percent for one year.Interest Cost = 10 % of $1000 = $100Processing Fees = $45Total Cost = $100 + $45 = $145Therefore APR = 145/1000= 14.50%So, the APR calculated by Jim Tree was 14.5%Hope this helps ..!!