You have just purchased a car and, to fund the purchase, you borrowed $20,000. If your...

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You have just purchased a car and, to fund the purchase, you borrowed $20,000. If your...

You have just purchased a car and, to fund the purchase, you borrowed $20,000. If your monthly payments are $473.82 for the next 4 years, what is the APR of the loan?

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Answer 1

Answer #1

Loan Amount, PV = $20,000

Monthly Payment, PMT = $473.82

Time Period, N = 48 months

Future Value, FV = 0

Calculating APR on Loan,

Using TVM Calculation,

I = [PV = 20,000, PMT = -473.82, N = 48, FV = 0]

I = 6.45%

So,

APR(monthly) on Loan = 6.45%

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Answer 2

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