What is the nominal annual interest rate

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Reference no: EM13187978

A local bank offers a customer a 2-year car loan of $10,000 as follows:

Money to pay for car : $10,000
Two years' interest at 7% : 2 x 0.07 x 10,000 : $1400 (11,400 total)
24 monthly payments : 11400 / 24 = $475.00

The first payment must be made in 30 days. What is the nominal annual interest rate the bank is receiving?

Reference no: EM13187978

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