Question
Lewis and Clark Camping Supplies Inc. is borrowing $42,000 from Western State Bank. The total interest is $17,500. The loan will be paid by making
Lewis and Clark Camping Supplies Inc. is borrowing $42,000 from Western State Bank. The total interest is $17,500. The loan will be paid by making equal monthly payments for the next three years.
What is the effective rate of interest on this installment loan? (Input your answer as a percent rounded to 2 decimal places.)
Step by Step Solution
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Step: 1
To calculate the effective rate of interest on an installment loan we can use the formula for c...
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
15th edition
77861612, 1259194078, 978-0077861612, 978-1259194078
