A bank is offering loan of $25,000 with a nominal interest rate of 18% compounded monthly, payable

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A bank is offering loan of $25,000 with a nominal interest rate of 18% compounded monthly, payable in 60 months. (Hint: The loan origination fee of 2% will be taken out from the loan amount.)

(a) What is the monthly payment?

(b) If a loan origination fee of 2% is charged at the time of the loan, what is the effective interest rate?

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Engineering Economics

ISBN: 9780195168075

9th Edition

Authors: Ted G. Feller

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Question Posted: Mar 01, 2010 04:35 AM

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A bank is offering loan of $25,000 with a nominal interest rate of 18% compounded monthly, payable

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P 25000 n 60 months i 18 per year 15 per month a A 25000 AP 15 60 635 b P 25000 ...View the full answer

Engineering Economics

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