You want to buy a car with a local bank that will lend you $20000. The loan will fully amortized over 5 years and the nominal rate of interest will be 14% with interest paid monthly, then a. What will be your monthly payment? b. Effective Annual Rate? c. Explain why total interest is different?
You want to buy a car with a local bank that will lend you $20000. The loan will fully amortized over 5 years and the nominal rate of interest will be 14% with interest paid monthly, then a. What will be your monthly payment? b. Effective Annual Rate? c. Explain why total interest is different?
Chapter4: Time Value Of Money
Section4.17: Amortized Loans
Problem 1ST
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You want to buy a car with a local bank that will lend you $20000. The loan will fully amortized over 5 years and the nominal rate of interest will be 14% with interest paid monthly, then
a. What will be your monthly payment?
b. Effective Annual Rate?
c. Explain why total interest is different?
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