An individual approaches the Loan Shark Agency for $1,000 to be repaid in 24 monthly installments....
An individual approaches the Loan Shark Agency for $1,000 to be repaid in 24 monthly installments. The agency advertises an interest rate of 1.5% per month. They proceed to calculate his monthly payment in the following manner.
Amount requested: $1000
Credit investigation: $25
Credit risk insurance: $5
Total : $1,030
a) What is the nominal interest rate?
b) What is the effective interest rate?
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An individual approaches the Loan Shark Agency for $1,000 to be
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