You have borrowed $20,000 from a bank for a five-year period. You will be making monthly payments on this loan and the interest rate on the loan is 12% per annum with interest compounded monthly. The effective annual interest rate on this loan is closest to: Group of answer choices A. 1.0% p.a. B. 12.0% p.a. C. 12.4% p.a. D. 12.7% p.a.

You have borrowed $20,000 from a bank for a five-year period. You will be making monthly payments on this loan and the interest rate on the loan is 12% per annum with interest compounded monthly. The effective annual interest rate on this loan is closest to: Group of answer choices A. 1.0% p.a. B. 12.0% p.a. C. 12.4% p.a. D. 12.7% p.a.

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter7: Using Consumer Loans

Section: Chapter Questions

Problem 6FPE

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