a car loan in a A man applied financing bank nich charges a rate of 18%. The interest is to be deducted from the loan at the time the money is released. At the end of one year, he has to pay the same amount as stated in his application for loan. What is the actual interest did the financing bank charge him?

Economics Today and Tomorrow, Student Edition
1st Edition
ISBN:9780078747663
Author:McGraw-Hill
Publisher:McGraw-Hill
Chapter6: Saving And Investing
Section6.1: Why Save?
Problem 6R
icon
Related questions
Question

Could you please solve the question below. THanks!

A man applied for a car loan in a local financing bank which charges a rate of 18%. The
interest is to be deducted from the loan at the time the money is released. At the end
of one year, he has to pay the same amount as stated in his application for loan. What
is the actual interest did the financing bank charge him?
Transcribed Image Text:A man applied for a car loan in a local financing bank which charges a rate of 18%. The interest is to be deducted from the loan at the time the money is released. At the end of one year, he has to pay the same amount as stated in his application for loan. What is the actual interest did the financing bank charge him?
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Discounting Payment Streams
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Economics Today and Tomorrow, Student Edition
Economics Today and Tomorrow, Student Edition
Economics
ISBN:
9780078747663
Author:
McGraw-Hill
Publisher:
Glencoe/McGraw-Hill School Pub Co