Loan amortization and ear

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Reference no: EM13724971

Loan amortization and EAR

You want to buy a car, and a local bank will lend you $40,000. The loan will be fully amortized over 5 years (60 months), and the nominal interest rate will be 7% with interest paid monthly.

a. What will be the monthly loan payment? Round your answer to the nearest cent.

b. What will be the loan's EAR? Round your answer to two decimal places.

Reference no: EM13724971

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