Your car loan requires payments of $1,000 per month over the next18 months and payments of $2,000 per month in the following 12 months. The effective annual interest rate charged is 12.6825% and the first payment begins in exactly one month. What is the present value of this 2.5-year car loan (i.e. how much does the loan cost you in today’s dollar)?
Your car loan requires payments of $1,000 per month over the next18 months and payments of $2,000 per month in the following 12 months. The effective annual interest rate charged is 12.6825% and the first payment begins in exactly one month. What is the present value of this 2.5-year car loan (i.e. how much does the loan cost you in today’s dollar)?
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 18P
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Your car loan requires payments of $1,000 per month over the next18 months and payments of $2,000 per month in the following 12 months. The effective annual interest rate charged is 12.6825% and the first payment begins in exactly one month. What is the
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