Suppose you have received a credit card offer from a bank that charges interest at 1.1% per quarter, compounded quarterly. What is the nominal interest (annual percentage) rate for this credit card? What is the effective annual interest rate?
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Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
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- Suppose you have received a credit card offerfrom a bank that charges interest at 1.4% per month,compounded monthly. What is the nominal interest(annual percentage) rate for this credit card? What isthe effective annual interest rate?Find the monthly interest payment in the situation described below. Assume that the monthly interest rate is 1/12 of he annual interest rate. You maintain an average balance of $500 on your credit card, which carries an 18% annual interest rate. The monthly interest payment is $ Type an integer or a decimal.)A credit card quotes a rate as 21.5% compounded monthly. a) What is the effective annual interest rate? b) What would the effective annual interest rate be with daily compounding (assume the 360 day convention)?
- What is the effective annual rate (EAR) if your credit card charges you 10.45 percent compounded quarterly? Show your formula/calculation/explanation! Why is it different from annual percentage rate?You have just received an offer from a bank for a credit card with a quoted rate, or APR, of 18 percent compounded monthly. What is the EAR, or effective annual rate, on the credit card?A commercial bank offers you a credit card with an annual percentage rate APR = 9%, compounding monthly. What’s the credit card’s nominal annual rate?
- You get a new credit card from your bank. The document that comes with the card informs you that the interest rate on that card is 24% APR with monthly compounding. What is the effective annual rate you'll actually be paying? Enter your answer as a percentage, rounded to 2 decimals, and without the percentage sign ('%'). For example, if your answer is 0.23456, then enter 23.46You get a new credit card from your bank. The document that comes with the card informs you that the interest rate on that card is 19.1% APR. What is the effective annual rate you'll actually be paying? The credit card company uses monthly compounding of interest. Enter your answer as a percentage, rounded to 2 decimals, and without the percentage sign ('%'). For example, if your answer is 0.23456, then enter 23.46 21.98Suppose your credit card issuer states that it charges a 17.00% nominal annual rate, but you must make monthly payments, which amounts to monthly compounding. What is the effective annual rate? a.16.08% b.16.88% c.15.27% d.17.72% e.18.39%
- You have recently seen a credit card advertisement that states that the annual percentage rate is 6.3 percent. If the credit card requires monthly payments, what is the effective annual rate of interest on the loan? (Round answer to 2 decimal places, e.g., 12.25.) Effective annual rate Type your answer here %To payoff a loan of $1000 you need to make 40 payment of $36.56 per month. What rate of interest are you paying? What is the stated or quoted rate? What is the annual percentage rate? What is the effective annual rate? What rate is bank likely to use to state its rate?(Calculating the effective annual rate) You've just received an offer from a bank for a credit card with a quoted rate, or APR, of 8 percent compounded monthly. What's the EAR, or effective annual rate, on the credit card? What's the EAR, or effective annual rate, on the credit card? nothing% (Round to two decimal places.)