Problem

In order to purchase a new car, imagine that you recently have borrowed $15,000 from a b...

In order to purchase a new car, imagine that you recently have borrowed $15,000 from a bank that charges you according to a nominal rate of 8%. The loan is payable in 60 months. (a) Calculate the monthly payments. (b) Assume the bank charges a loan fee of 4.5% of the loan amount payable at the time they give you the loan. What is the effective interest rate that you actually are being charged?

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Solutions For Problems in Chapter 20