--%>
Assignment Help - homework help

APR of Loan

When you take out an $8,000 car loan that calls for 48 monthly payments of $225 each, then what is the APR of loan?

E

Expert

Verified

Let ROI is 12%
Monthly int rate is 1%pm
(1+1/100)^48 = 37.97
37.97*225=8543
Loan amt is 8000 and amt paid is 8543
Therefore int paid is 543
Now i don’t know exactly but it may be like this
543/8000*12/48*100=.17%

   Related Questions in Corporate Finance

  • Q : Historical return on stock market and

    The market risk premium is difference among the historical return upon the stock market and the risk-free rate, for yearly. Why is this negative for some years?

    		•
  • Q : Which capital structure must consider

    Which capital structure must we consider when estimating the WACC for a subsidiary valuation: the one which is reasonable according to the risk of the subsidiary’s business that the average of the company or the one the subsidiary as “tolerates/per

    		•
  • Q : Assessing market expectations using CAPM

    Assume that the risk-free rate is 1% and the expected market return is 9%. You are considering purchasing Super Soft stock, which currently sells for $100 a share and will pay its next (annual) dividend of $1.00 exactly one year from today. Super Soft is considered to

    		•
  • Q : Minimum annual savings problem XYZ

    XYZ Company is interested in purchasing a new corporate jet for $6 million. This will depreciate the jet completely in 5 years and then sell it for $5 million. The jet will utilize $60,000 in fuel annually, and its maintenance will be $40,000 yearly. The tax rate of X

    		•
  • Q : Is net income of a year is doubtful for

    Is the net income of a year money the company made that given year or is this a number whose importance is quite doubtful?

    		•
  • Q : Benefits of Cash to cash analysis

    Benefits of Cash to cash analysis: The benefits of Cash to cash analysis are as following: 1. Helps in better cash management situation thus, increasing liquidity. 2. The cash a

    		•
  • Q : Calculating the Cost of Equity You are

    You are an analyst in the financial division of Flipper Industries (FI) which has a beta of 1.80 (you are risk-philic, so you enjoy the thrill of working somewhere so risky). The company just paid a dividend of $1 and dividends are expected to grow at 5% per year. The

    		•
  • Q : All rates are stated annually with

    1 Assume the following (all rates are stated annually with semiannual compounding) a. Six Month Spot Rate is 2% b. Six Month Forward rate starting at month six is 2.2% c. Six Month Forward rate starting at month 12 is 2.4% d. Six Month Forward rate starting at mont

    		•
  • Q : How WACC should be computed to begin a

    I cannot seem to begin a valuation. In order to compute E + D = VA (FCF; WACC) I require the WACC and to compute the WACC I need D and E. Where must I start?

    		•
  • Q : Is book value the excellent proxy to

    Is book value the excellent proxy to the value of the shares?

    		•