What rate should shop report-what is effective annual rate

Assignment Help Financial Management

Reference no: EM13848999

Ricky Ripov’s Pawn Shop charges an interest rate of 15 percent per month on loans to its customers. Like all lenders, Ricky must report an APR to consumers:

Requirement 1:

What rate should the shop report? (Round your answer as directed, but do not use rounded numbers in intermediate calculations. Enter your answer as a percent rounded to decimal places (e.g., 32.16).

Annual percentage rate %

Requirement 2:

What is the effective annual rate? (Round your answer as directed, but do not use rounded numbers in intermediate calculations. Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).)

Reference no: EM13848999

Questions Cloud

What is the estimated required rate of return : Woidtke Manufacturing's stock currently sells for $30 a share. The stock just paid a dividend of $2.00 a share (i.e., D0 = $2.00), and the dividend is expected to grow forever at a constant rate of 7% a year. What stock price is expected 1 year from ..

Two types of bonds-what is the value of the warrants : Gregg Company recently issued two types of bonds. The first issue consisted of 20-year straight (no warrants attached) bonds with an 10% annual coupon. The second issue consisted of 20-year bonds with a 7% annual coupon with warrants attached. Both b..

Investment in small renewable energy power plant : A municipality is considering an investment in a small renewable energy power plant with the following parameters. The cost is $360,000, and the output averages 50 kW year-round. Calculate the NPV of this investment. Is it financially attractive?

Tackle the problem of nitrates in the water : Suppose El Centro California decides to tackle the problem of nitrates in the water. Nitrates are compounds derived from synthetic fertilizers that are not assimilated by plants and leached out into the underground water and affect the human health. ..

What rate should shop report-what is effective annual rate : Ricky Ripov’s Pawn Shop charges an interest rate of 15 percent per month on loans to its customers. Like all lenders, Ricky must report an APR to consumers: What rate should the shop report? (Round your answer as directed, but do not use rounded numb..

What is the projects operation cash flow for first year : The financial staff od Carin Communications has identified the fallowing information for the first year of the roll-out of its new proposed services: The company faces a 40% tax rate. What is the project’s operation cash flow for the first year (t=1)..

What is the investment outlay : Talbot Industries is considering launching a new product. The new manufacturing equipment will cost $17 million, and production and sales will require an initial $5,000,000 investment in net operating working capital. The company tax rate is 40%. Wha..

Complete business program-including tuition-costs of living : Raul's friend wants to fo to business school. While his father will share some of the expenses, Zach will still needs to put in the rest of his own. But Zach has no money saved for it yet. According to him, it will take him $16,391 to complete the bu..

An efficient market is one in which no one ever profits : An efficient market is one in which no one ever profits from having better information than the rest. Discuss this statement and whether or not you find this to be true, false or are you uncertain. Why?

User Account

All Pages