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You want to borrow $86,000 from your local bank to buy a new sailboat. You can afford to make monthly payments of $1,500, but no more. Assuming monthly compounding, what is the highest rate you can afford on a 72-month APR loan? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Interest rate 7.81+4%) %
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Answer #1

Please provide rating..

we have to use financial calculator to solve this problem
Put in calculator -
PV -86000
FV 0
PMT 1500
N 72
Compute I 0.65%
Therefore APR =0.65%*12 7.81%
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