(Compound

interest with nonannual

periods)

After examining the various personal loan rates available to you, you find that you can borrow funds from a finance company at an APR of

12

percent compounded

monthly

or from a bank at an APR of

13

percent compounded

annually.

Which alternative is more attractive?

a. If you borrow

$100

from a finance company at an APR of

12

percent compounded

monthly

for

1

year, how much do you need to payoff the loan?

$nothing

(Round to the nearest cent.)