Use the formula in the problem. Choose the correct answer.

Payments of $27.50 are made monthly for a period of 36 months, and the amount financed is $835. What is the APR using the formula above?

Question

Use the formula in the problem. Choose the correct answer.



Payments of $27.50 are made monthly for a period of 36 months, and the amount financed is $835. What is the APR using the formula above?

awesomedude2078 · Answer

https://fallriver.owschools.com/media/o_cma_2016/10/5_7apr.gif

awesomedude2078 · Answer

@AloneS @Awolflover1

awesomedude2078 · Answer

@tkhunny

tkhunny · Answer

Never seen that formula.  It is an approximation that may have some value.

y = payments per year = 12
c = total interest paid = (36 * 27.50) - 835
m = amount financed = 835
n = total number of payments = 36

It is just a matter of finding the definitions and implementing them.

I get 12.0281484 for the exact result.
Not far from the formula's 12.0407833

awesomedude2078 · Answer

i don't know this formula all that well either