You are considering buying an Audi for $65,000, and your financing is quoted at 7% APR with monthly compounding. a. What rate do you need in order to use one of the following annuity formulas to find the monthly payments? PV(annuity of C for n periods with interest rate r)=C1r11(1+r)norPV(growing perpetuity)=Crg b. What is the effective annual rate of interest for this financing? (round to six decimal places.)

Problem 5-8 You are considering buying an Audi for $65,000, and your financing is quoted at 7% APR with monthly compounding. a. What rate do you need in order to use one of the following annuity formulas to find the monthly payments? 1 1 PV(annuity of C for n periods with interest rate r) = CX- / or PV(growing perpetuity) r (1 + r)" r-g b. What is the effective annual rate of interest for this financing? a. The rate that should be used for the formulas is r= (Round to six decimal places.)