Mathematics
Easy

Question

# The approximate annual interest rate r of a monthly installment loan is given by the formula: Where n is the total number of payments, m is the monthly payment, and p is the amount financed.find the approximate annual interest rate (to the nearest tenth percent) for a five-year auto loan of \$ 40,000 that has monthly payments of \$ 750.

## 5.8 %9.56 %3.4 %4.6 % Hint:

## The correct answer is: 4.6 %

### So now we know that the cost you pay annually for borrowing money, including fees, is stated as a percentage and is known as the annual percentage rate (APR).We have given the expression as: Here we sed the concept of simple interest, compound interest and found out the annual rate. Simple Interest (S.I.) is a way for figuring out how much interest will accrue on a specific principal sum of money at a certain rate of interest. So the annual rate percent is 4.6%.

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