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is purchasing today a new Lamborghini for $140000 and the finance office at the dealership is quoting an APR of 7.32 compounded monthly for an eight year loan in order to buy the car If her first payment is one month from today what will her monthly payment be over the period of the loan What is the Effective Annual Rate of the loan

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Answer:

7.57%

Explanation:

The formula for effective annual rate is provided below which forms the basis for determining the effective annual rate:

effective annual rate=(1+APR/m)^m-1

APR=annual percentage rate=7.32%

m=number of times in a year that is the interest is compounded=12

effective annual rate=(1+7.32%/12)^12-1

effective annual rate=(1+0.0061 )^12-1

effective annual rate=1.075706488 -1

effective annual rate=7.57%

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