find the annual percentage rate on a loan of $1,500 for 18months if the loan requires $190 interest and is repaid monthly.
To find the annual percentage rate (APR) on a loan, you can use the following formula:
APR = (Interest / Loan Amount) * (12 / Loan Term) * 100%
Given:
Loan amount (P) = $1,500
Interest (I) = $190
Loan term (n) = 18 months
We can substitute these values into the formula to find the APR:
APR = (190 / 1500) * (12 / 18) * 100%
First, let's simplify the expression inside the parentheses:
APR = (0.1266667) * (0.6666667) * 100%
Now, let's calculate the product inside the parentheses:
APR = 0.0844445 * 100%
Finally, calculating the APR:
APR = 8.44%
Therefore, the annual percentage rate on the loan is approximately 8.44%.
To find the Annual Percentage Rate (APR) on a loan, you'll need to use the formula:
APR = (Total Interest / Loan Amount) x (12 / Loan Term) x 100
In this case, the loan amount is $1,500, the interest is $190, and the loan term is 18 months.
First, plug these values into the formula:
APR = (190 / 1500) x (12 / 18) x 100
Now we can calculate it step by step:
Step 1: (190 / 1500) = 0.1267
Step 2: (12 / 18) = 0.6667
Step 3: 0.1267 x 0.6667 = 0.0845
Step 4: 0.0845 x 100 = 8.45
Therefore, the APR on the loan is approximately 8.45%.
Assuming simple interest, since compounding isn't mentioned in the question:
18 months = 1.5 years
I = Prt
190 = 1500 * r * 1.5
r ~ 0.084 or 8.4 %/a