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
(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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Future Value=Present Value*(1+r/m)^m
1.
=100*(1+12%/12)^12=112.682503013197
2.
=100*(1+13%/1)^1=113.00
3.
The loan from the finance company at an APR of 12% compounded monthly
