Question: A farmer needs to borrow $1,500. The local PCA will make a 2-year loan fully amortized at 10% with annual payments. A $10 dollar loan

A farmer needs to borrow $1,500. The local PCA will make a 2-year loan fully amortized at 10% with annual payments. A $10 dollar loan fee and stock purchase is required. There is a 2% stock requirement.

What is the actuarial rate?

What is the APR?

What is the effective rate?

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