What is effective annual rate

Assignment Help Financial Management

Reference no: EM131300323

Ricky Ripov’s Pawn Shop charges an interest rate of 16.5 percent per month on loans to its customers. Like all lenders, Ricky must report an APR to consumers.

What rate should the shop report? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

What is the effective annual rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Reference no: EM131300323

Questions Cloud

How much should she deposit in a savings account : Excited about your pending birth, your grandmother plans to give you $750 for a present on your birthday when you turn 18. How much should she deposit in a savings account when you are born to generate your future present? The savings account pays 3%..

Assuming no transaction costs : You have the opportunity to buy the right to be paid $600 every 6 months for the next 3 years with an interest rate of 3.6 percent compounded semiannually. At what price do neither you nor the seller make any money on this deal, assuming no transacti..

Complete portfolios expected return : Complete Portfolio’s Expected Return? Complete Portfolio’s Standard Deviation? Risky asset’s Sharpe ratio? Complete Portfolio’s Sharpe ratio?

Foreign bond with the same risk and maturity characteristics : Suppose that spot and forward exchange rates are measured in units of domestic currency per unit of foreign currency. There is a positive forward premium for the domestic currency. If covered interest parity holds, what should be true of the differen..

What is effective annual rate : Ricky Ripov’s Pawn Shop charges an interest rate of 16.5 percent per month on loans to its customers. Like all lenders, Ricky must report an APR to consumers. What rate should the shop report? What is the effective annual rate?

What is change in price the bond will experience in dollars : A 6.80 percent coupon bond with 14 years left to maturity is priced to offer a 7.5 percent yield to maturity. You believe that in one year, the yield to maturity will be 7.1 percent. What is the change in price the bond will experience in dollars?

What is your after tax rate of return : Suppose you invest $100 today, your return for the year is $25, and your tax rate is 20%. what is your before tax rate of return? how much money did you earn after taxes? what is your after tax rate of return?

Broader coverage than the causes-of-loss special form : The causes-of-loss broad form provides broader coverage than the causes-of-loss special form. Business income (and extra expense) coverage provides limited coverage if business is interrupted as a result of a computer hacker breaking into a company’s..

What is the purpose of internal controls in a business : A firm has total assets of $1,910,000. It has $810,000 in long-term debt. The stockholders equity is $610,000. What is the debt to total asset ratio? What is the purpose of internal controls in a business? What is something that could happen if the p..

User Account

All Pages