A local finance company quotes an interest rate of 193, Ask an Expert

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A local finance company quotes an interest rate of 19.3 percent on one-year loans. So, if you borrow $45,000, the interest for the year will be $8,685. Because you must repay a total of $53,685 in one year, the finance company requires you to pay $53,685/12, or $4,473.75 per month over the next 12 months. What rate would legally have to be quoted? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) APR % What is the effective annual rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) EAR %

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Financial Management, Finance

Category:- Financial Management
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