No Tree Too Tall, Inc. is planning to borrow $12,000 from the bank. The bank offers...
No Tree Too Tall, Inc. is planning to borrow $12,000 from the bank. The bank offers the choice of a 12 percent discount interest loan or a 10.19 percent add-on, one-year installment loan, payable in 4 equal quarterly payments. What is the effective rate of interest on the 10.19 percent add-on loan? a. 16.99% b. 9.50% c. 15.22% d. 22.05% e. 10.19%
Homework Answers
What is the effective rate of interest on the 10.19 percent
add-on loan?
=(1+RATE(4,-12000*(1+10.19%)/4,12000))^4-1
=16.99%
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