A local finance company quotes a 18 percent interest rate on one-year loans. So, if...
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Accounting
A local finance company quotes a 18 percent interest rate on one-year loans. So, if you borrow $16,000, the interest for the year will be $2,880. Because you must repay a total of $18,880 in one year, the finance company requires you to pay $18,880 divided by 12, or $1,573.33, per month over the next 12 months. Is this a 18 percent loan? (Do not round intermediate calculations. Round the final answer to 2 decimal places.)
What rate would legally have to be quoted?
Annual percentage rate %
What is the EAR?
Effective annual rate
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