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Question & Answer: 4. A loan of r$15,000 requires monthly payments of $477 over a 36 month period of time. requir These payments include both…..

4. A loan of r$15,000 requires monthly payments of $477 over a 36 month period of time. requir These payments include both principal and interest. a. Wh at is the nominal interest rate (APR) for this loan? (4 pts) 49A: 0门5% ya.acb 屮7 , pis,000 (nlBio 3k b. What is the effective interest rate per year? (3 pts)oweer | :0.cn38 :19:38% pen ear c. Determine the amount of unpaid loan principal after 20 months. (3 pts) 3

4. A loan of r$15,000 requires monthly payments of $477 over a 36 month period of time. requir These payments include both principal and interest. a. Wh at is the nominal interest rate (APR) for this loan? (4 pts) 49A: 0门5% ya.acb 屮7 , pis,000 (nlBio 3k b. What is the effective interest rate per year? (3 pts)oweer | :0.cn38 :19:38% pen ear c. Determine the amount of unpaid loan principal after 20 months. (3 pts) 3

Expert Answer

 

a)

Annual percentage rate is 9% (0.75%*12)

b)

Effective annual rate:

= (1+0.75%)^12-1

= 9.38%

c)

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