The table below, from Standard Chartered Bank, is the monthly payment for different loan terms. Read the table carefully. Then explain how the monthly payment is determined by the annualized percentage rate. Specially, why monthly payment=$21.87 under 15.75% rate? Hint: you need to consider two things. (1) The Annualized Percentage Rate here refers to nominal rate or effective rate? (2) How is the handling fee included? 
Personal Instalment Loan monthly repayment table - exclusive for privileged customers Monthly repayment amount (per HK$1,000) (Annualized Percentage Rate) Loan amount Interest rate (HK$) (Monthly flat) Loan tenor 12 months 24 months 36 months 48 months 60 months $5,000 - $19,999 0.52% $88.54 (15.16%) $46.87 (15.66%) $32.98 (15.76%) $26.04 (15.77%) $21.87 (15.75%) $20,000 - $49,999 0.36% $86.94 $45.27 (11.28%) (11.71%) $31.38 (11.85%) $24.44 (11.91%) $20.27 (11.94%) $50,000 - $199,999 0.26% $85.94 (8.89%) $44.27 (9.26%) $30.38 (9.40%) $23.44 (9.48%) $19.27 (9.54%) $200,000 - $499,999 0.20% $85.34 (7.47%) $43.67 (7.80%) $29.78 (7.94%) $22.84 (8.02%) $18.67 (8.08%) $500,000 - $1,200,000 0.16% $84.94 (6.54%) $43.27 (6.83%) $29.38 (6.96%) $22.44 (7.04%) $18.27 (7.11%) Each of the monthly repayment amounts shown in the table above includes a handling fee of 1.5% per year. The handling fee will be deducted from the final approved drawdown amount. For example, the drawdown amount of $20000 with a loan of 2 year, the handling fee is $600 (i.e., $20000*1.5%*2=$600) Personal Instalment Loan monthly repayment table - exclusive for privileged customers Monthly repayment amount (per HK$1,000) (Annualized Percentage Rate) Loan amount Interest rate (HK$) (Monthly flat) Loan tenor 12 months 24 months 36 months 48 months 60 months $5,000 - $19,999 0.52% $88.54 (15.16%) $46.87 (15.66%) $32.98 (15.76%) $26.04 (15.77%) $21.87 (15.75%) $20,000 - $49,999 0.36% $86.94 $45.27 (11.28%) (11.71%) $31.38 (11.85%) $24.44 (11.91%) $20.27 (11.94%) $50,000 - $199,999 0.26% $85.94 (8.89%) $44.27 (9.26%) $30.38 (9.40%) $23.44 (9.48%) $19.27 (9.54%) $200,000 - $499,999 0.20% $85.34 (7.47%) $43.67 (7.80%) $29.78 (7.94%) $22.84 (8.02%) $18.67 (8.08%) $500,000 - $1,200,000 0.16% $84.94 (6.54%) $43.27 (6.83%) $29.38 (6.96%) $22.44 (7.04%) $18.27 (7.11%) Each of the monthly repayment amounts shown in the table above includes a handling fee of 1.5% per year. The handling fee will be deducted from the final approved drawdown amount. For example, the drawdown amount of $20000 with a loan of 2 year, the handling fee is $600 (i.e., $20000*1.5%*2=$600)
