Question
Lisa East is considering buying a new Tacoma truck. She has negotiated a purchase price of $32,000. The length of the loan will be 72
Lisa East is considering buying a new Tacoma truck. She has negotiated a purchase price of $32,000. The length of the loan will be 72 months. She has reviewed her personal budget and can afford a payment of around $500 per month.
Lisa must now negotiate an interest rate. What annual interest rate will get her closest to her desired $500 monthly payment. The interest rate is compounded monthly?
Step by Step Solution
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There are 3 Steps involved in it
Step: 1
To find the interest rate we can use the loan payment formula P r PV 1 1 ...
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Fundamentals Of Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
5th Edition
0135811600, 978-0135811603
