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You are about to purchase a new motorbike, and you have two payment options: (a) You can pay $5,000 in cash immediately, or (b) You

You are about to purchase a new motorbike, and you have two payment options: (a) You can pay $5,000 in cash immediately, or (b) You can get a loan that requires you to pay $120 each month for the next four years. What should be the interest rate such that you are indifferent between the two options?

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