6.Consider a 5-year auto loan of $80,000 at 6% APR. This loan requires 5 equal annual payments,...

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6.Consider a 5-year auto loan of $80,000 at 6% APR. This loan requires 5 equal annual payments, with the first payment due at the end of the first year.

a. Show that the annual payment is $18,991.72.

b. Complete the table below.

c. Consider the same auto loan in the question above but requires monthly payments.

d. How much is the monthly payment?

e. What is the effective annual rate (EAR) of this loan?(5 marks)

Related Book For answer-question

Fundamentals Of Corporate Finance

ISBN: 9780135811603

5th Edition

Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford

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Posted Date: Nov 10, 2023 02:01 AM

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6.Consider a 5-year auto loan of $80,000 at 6% APR. This loan requires 5 equal annual payments,...

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a To calculate the annual payment for the 5year auto loan we can use the formula for the present val... View the full answer

Fundamentals Of Corporate Finance

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