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A local finance company quotes an interest rate of 17 percent on one-year loans. So, if you borrow $34,000, the interest for the year will
A local finance company quotes an interest rate of 17 percent on one-year loans. So, if you borrow $34,000, the interest for the year will be $5,780. Because you must repay a total of $39,780 in one year, the finance company requires you to pay $39,780/12, or $3,315.00, per month over the next 12 months. a. What interest rate would legally have to be quoted? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g. 32.16.) b. What is the effective annual rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) % a. Annual percentage rate b. Effective annual rate % What is the future value of $1,900 in 18 years assuming an interest rate of 7.2 percent compounded semiannually? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g. 32.16.) Future value $ 5,716.45
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