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Calculate Profit of 4-Month Loan at 30% APR

AffirmData Scientist · Technical Screen
EasyData ScientistTechnical ScreenAnalytics & Experimentation

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This interview question evaluates metric design, causal reasoning, experiment setup, diagnostics, SQL/statistical checks, and recommendations in a realistic interview setting. A strong answer for Calculate Profit of 4-Month Loan at 30% APR states assumptions, handles edge cases, explains trade-offs, and shows how to validate the result clearly.

Scenario

Credit Risk – Short-term personal loan profitability evaluation

Question

What is the profit of a 4-month loan with principal $1,000 and 30% APR when there is no compounding, inflation, or opportunity cost?

Hints

Convert APR to monthly interest, multiply by four months, total interest equals profit.