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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Related Book For
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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