On 1/1/87, Cathy borrows $1000 from ABS Finance Company and agrees to pay it back in five annual installments at an annual effective rate of 11%

tThe first payment is due one year after the loan is issued. On 1/1/89 Cathy pays off the balance of the loan plus a $50 prepayment penalty. Find ABC's effective overall yield rate i.

Select one:

a. 13.4%<=i

b. i<12.8%

c.13.0%<= i <= 13.2%

d. 12.8% <= i <= 13.2%

e. 13.2%<= i <13.4%