You have just purchased a new warehouse. To finance the purchase, you’ve arranged for a 35-year mortgage for 85 percent of the $3,100,000 purchase price. The monthly payment on this loan will be $17,200.

What is the APR on this loan?
What is the EAR on this loan?

Well, I must confess, numbers are not my strong suit. However, I can still attempt to lighten up the topic of mortgages for you!

Why did the scarecrow become a mortgage broker? Because he was outstanding in his field!

Now, let's try to address your question. To determine the Annual Percentage Rate (APR) and Effective Annual Rate (EAR) of the loan, we need some additional information. Specifically, we'll need to know any additional fees, closing costs, and the compounding frequency of the interest. Once we have all that, I might still not be able to calculate it, but hey, at least we had a laugh!

To calculate the APR (Annual Percentage Rate) on the loan, we need to know the interest rate. We can determine the interest rate by finding the loan amount and the monthly payment.

Step 1: Calculate the loan amount:
Loan amount = Purchase price x Loan percentage
Loan amount = $3,100,000 x 0.85
Loan amount = $2,635,000

Step 2: Calculate the interest rate:
Interest Rate = Monthly payment x 12 / Loan amount
Interest Rate = $17,200 x 12 / $2,635,000
Interest Rate ≈ 0.078 or 7.8%

Therefore, the APR on this loan is approximately 7.8%.

To calculate the EAR (Effective Annual Rate), we need to consider any fees or costs associated with the loan and any compounding periods.

Assuming there are no additional fees or costs and the loan is compounded annually, the EAR would be equal to the APR.

So, the EAR on this loan is also approximately 7.8%.

To calculate the APR (Annual Percentage Rate) and EAR (Effective Annual Rate) on a loan, we need to know the relevant details such as the loan amount, interest rate, and loan term. In this case, we're given that the loan amount is 85 percent of $3,100,000 and the monthly payment is $17,200. However, the interest rate and loan term are missing.

To find the missing values, we'll use the monthly payment amount. The monthly payment on a mortgage is based on the loan amount, interest rate, and loan term.

1. Finding the Loan Amount:
The loan amount is 85 percent of $3,100,000:
Loan amount = 0.85 × $3,100,000 = $2,635,000

2. Finding the Interest Rate:
To find the interest rate, we can use the monthly payment formula for a fixed-rate mortgage:

M = P * (r/12) / (1 - (1 + r/12)^(-n*12))

Where:
M = Monthly payment
P = Loan amount
r = Monthly interest rate
n = Loan term in years

Rearranging the formula, we can solve for r:

r = (12 * M) / (P * (1 - (1 + (12 * M) / P)^(-n*12)))

Substituting the known values:

r = (12 * $17,200) / ($2,635,000 * (1 - (1 + (12 * $17,200) / $2,635,000)^(-35*12)))

This calculation will give us the monthly interest rate.

3. Calculating the APR:
The APR represents the yearly interest rate. To convert the monthly interest rate to the APR, we multiply it by 12:

APR = r * 12

4. Calculating the EAR:
The EAR takes into account compounding. To find the EAR, we need to calculate the compound interest rate based on the monthly interest rate:

EAR = (1 + r/12)^12 - 1

By following these steps, we can find the APR and EAR of the loan. However, I am unable to provide the exact values as the interest rate and loan term are missing in the question. Please provide the missing information so I can assist you further.