Timothy Lawrence plans to borrow $5,000 and to repay it in 36 monthly installments. This loan is

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Timothy Lawrence plans to borrow $5,000 and to repay it in 36 monthly installments. This loan is being made at an annual add-on interest rate of 7.5 percent.

a. Calculate the finance charge on this loan, assuming that the only component of the finance charge is interest.

b. Use your finding in part (a) to calculate the monthly payment on the loan.

c. Using a financial calculator, determine the APR on this loan. Confirm your result with a spreadsheet.

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Personal Financial Planning

ISBN: 9780357438480

15th Edition

Authors: Randy Billingsley, Lawrence J. Gitman, Michael D. Joehnk

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Question Posted: Jan 11, 2023 01:48 AM

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Timothy Lawrence plans to borrow $5,000 and to repay it in 36 monthly installments. This loan is

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a Using Addon Method Interest Amount of Loan Interest ...View the full answer

Personal Financial Planning

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