The APR for loans can also be approximated (however, not within the 1 4 of 1% accuracy required by Regulation Z†) by using the following formula: APR = 2mI P(n + 1) where m = the number of payment periods per year I = the interest (or finance charge) P = the principal (amount financed) n = the number of periodic payments to be made. Thus, if m = 12, I = $264, P = $1200 and n = 30, APR = 2mI P(n + 1) = 2 × 12 × 264 1200 × 31 = 17%. Use the APR formula to find the APR to one decimal place. (Assume m = 12.) Amount Financed Finance Charge Number of Payments $4000 $332 12 % State the difference between the answer obtained by the formula and the answer obtained using the True Annual Interest Rate (APR) table. (Round your answer to one decimal place.) %
The APR for loans can also be approximated (however, not within the 1 4 of 1% accuracy required by Regulation Z†) by using the following formula: APR = 2mI P(n + 1) where m = the number of payment periods per year I = the interest (or finance charge) P = the principal (amount financed) n = the number of periodic payments to be made. Thus, if m = 12, I = $264, P = $1200 and n = 30, APR = 2mI P(n + 1) = 2 × 12 × 264 1200 × 31 = 17%. Use the APR formula to find the APR to one decimal place. (Assume m = 12.) Amount Financed Finance Charge Number of Payments $4000 $332 12 % State the difference between the answer obtained by the formula and the answer obtained using the True Annual Interest Rate (APR) table. (Round your answer to one decimal place.) %
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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Question
100%
The APR for loans can also be approximated (however, not within the
| 1 |
| 4 |
of 1% accuracy required by Regulation Z†) by using the following formula:
APR =
| 2mI |
| P(n + 1) |
where
| m | = | the number of payment periods per year |
| I | = | the interest (or finance charge) |
| P | = | the principal (amount financed) |
| n | = | the number of periodic payments to be made. |
Thus, if
m = 12, I = $264, P = $1200 and n = 30,
APR =
=
= 17%.
| 2mI |
| P(n + 1) |
| 2 × 12 × 264 |
| 1200 × 31 |
Use the APR formula to find the APR to one decimal place. (Assume m = 12.)
| Amount Financed |
|
Finance Charge |
|
Number of Payments |
|---|---|---|---|---|
| $4000 |
|
$332 |
|
12 |
%
State the difference between the answer obtained by the formula and the answer obtained using the True Annual Interest Rate (APR) table. (Round your answer to one decimal place.)
%
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