Essa Farook has been shopping for a loan to finance the purchase of a used car. He has found three possibilities that seem attractive and wishes to select the one with the lowest interest rate. The information available with respect to each of the three US$5,000 loans is shown in the following table.

a. Determine the interest rate associated with each of the loans.
b. Which loan should Essa take?

Transcribed Image Text:

Loan Principal Annual payment Term (years) USS5,000 5,000 5,000 USS1,352.81 1,543.21 2,010.45 4