Assuming that interest is the only finance charge, how much interest would be paid on a $5,000 installment loan to be repaid in 24 monthly installments of $235.54? Round the answer to the nearest cent. $ What is the APR on this loan? Round the answer to 2 decimal places. %
Assuming that interest is the only finance charge, how much interest would be paid on a $5,000 installment loan to be repaid in 24 monthly installments of $235.54? Round the answer to the nearest cent. $ What is the APR on this loan? Round the answer to 2 decimal places. %
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter7: Using Consumer Loans
Section: Chapter Questions
Problem 7FPE: Calculating interest and APR of installment loan. Assuming that interest is the only finance charge,...
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Assuming that interest is the only finance charge, how much interest would be paid on a $5,000 installment loan to be repaid in 24 monthly installments of $235.54? Round the answer to the nearest cent.
$
What is the APR on this loan? Round the answer to 2 decimal places.
%
Expert Solution
Step 1: Introduction
When the borrower borrows a loan from the lender, he has to pay a rate of interest on the borrowed amount. The rate of interest can be compounded monthly, quarterly, semi-annually, and annually, depending on the terms of the lending contract.
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