Calculating APR A local finance company quotes a 14 per cent interest rate on one-year loans. So,

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Calculating APR A local finance company quotes a 14 per cent interest rate on one-year loans. So, if you borrow €20,000, the interest for the year will be €2,800. Because you must repay a total of €22,800 in one year, the finance company requires you to pay €22,800/12, or

€1,900, per month over the next 12 months. Is this a 14 per cent loan? What rate would legally have to be quoted?

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Corporate Finance

ISBN: 9780077173630

3rd Edition

Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe

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Question Posted: Feb 19, 2024 01:00 AM

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Calculating APR A local finance company quotes a 14 per cent interest rate on one-year loans. So,

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No this is not a 14 loan The annual percentage rate APR is the rate at which interest accrues on a l...View the full answer

Corporate Finance

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