question archive (Compound interest with nonannual periods) After examining the various personal loan rates available to you, you find that you can borrow funds from a finance company at an APR of 12 percent compounded monthly or from a bank at an APR of 13 percent compounded annually
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(Compound interest with nonannual periods) After examining the various personal loan rates available to you, you find that you can borrow funds from a finance company at an APR of 12 percent compounded monthly or from a bank at an APR of 13 percent compounded annually. Which alternative is more attractive? a. If you borrow $100 from a finance company at an APR of 12 percent compounded monthly for 1 year, how much do you need to payoff the loan? $ 112.68 (Round to the nearest cent.) b. If you borrow $100 from a bank at an APR of 13 percent compounded annually for 1 year, how much do you need to payoff the loan? (Round to the nearest cent.)
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