Question: A farmer needs to borrow $2,333.92. The local PCA will make a 2-year loan fully amortized at 12% with quarterly payments. A $10 dollar loan

A farmer needs to borrow $2,333.92. The local PCA will make a 2-year loan fully amortized at 12% with quarterly payments. A $10 dollar loan fee and stock purchase is required. There is a 4% stock requirement.

(i) What is the actuarial rate?

(ii) What is the APR?

(iii) What is the effective rate?

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