You have just purchased a new warehouse. To finance the purchase, you’ve arranged for a 25-year mortgage for 75 percent of the $3,600,000 purchase price. The monthly payment on this loan will be $17,700.


What is the APR on this loan?

17700( 1 - (1+i)^-300)/i = 2700000

(1 - (1+i)^-300 )/i = 152.5423729

nasty.. going to use Wolfram

http://www.wolframalpha.com/input/?i=%281+-+%281%2Bx%29%5E-300+%29%2Fx+%3D+152.5423729

I = .0051528

annual rate compounded monthly = .0618..
or appr 6.18%

To calculate the Annual Percentage Rate (APR) on this loan, you need to know the loan's interest rate, which is not provided in the question. However, we can calculate the APR by reverse-engineering the interest rate based on the monthly payment and loan details given.

Here's how you can calculate the APR:

Step 1: Calculate the loan amount:
Since the loan covers 75% of the purchase price, multiply the purchase price by 75/100:
Loan amount = $3,600,000 * 75/100 = $2,700,000

Step 2: Calculate the total payment over the loan term:
Multiply the monthly payment by the number of months in a year and the total number of years:
Total payment = $17,700 * 12 * 25 = $5,310,000

Step 3: Calculate the total interest paid over the loan term:
Subtract the loan amount from the total payment to determine the total interest paid:
Total interest = Total payment - Loan amount = $5,310,000 - $2,700,000 = $2,610,000

Step 4: Calculate the average annual interest rate:
Divide the total interest paid by the loan amount and the loan term in years:
Average annual interest rate = (Total interest / Loan amount) / Loan term = ($2,610,000 / $2,700,000) / 25 = 0.0963

Step 5: Convert the average annual interest rate to a percentage:
Multiply the result by 100 to express it as a percentage:
APR = Average annual interest rate * 100 = 0.0963 * 100 ≈ 9.63%

Therefore, the approximate APR on this loan is around 9.63%.

To determine the APR (Annual Percentage Rate) on the loan, we need to know the total amount paid over the course of the loan, including interest. We also need to know the loan's term.

In this case, the loan amount is 75 percent of $3,600,000, which is $2,700,000. The loan term is 25 years, and the monthly payment is $17,700.

To calculate the total amount paid over the loan term, multiply the monthly payment by the number of payments in 25 years:

Total Amount Paid = Monthly Payment * Number of Payments
Total Amount Paid = $17,700 * 12 months * 25 years
Total Amount Paid = $5,310,000

The interest paid is the difference between the total amount paid and the loan amount:

Interest Paid = Total Amount Paid - Loan Amount
Interest Paid = $5,310,000 - $2,700,000
Interest Paid = $2,610,000

Now, we can calculate the APR using the loan amount, monthly payment, and interest paid:

APR = (2 * Total Interest Paid) / (Loan Amount * Loan Term)
APR = (2 * $2,610,000) / ($2,700,000 * 25 years)
APR = (2 * $2,610,000) / ($67,500,000)
APR = $5,220,000 / $67,500,000
APR ≈ 0.077 or 7.7%

Therefore, the APR on this loan is approximately 7.7%.