Multiple Choice
Luke Galen purchased an automobile with a list price of $4,387. He signed a contract requiring a $1,000 down payment and $1,000 payments at the beginning of each subsequent year for four years. Compute the annual implicit (effective) rate of interest on this financing loan.
A) 5%
B) 6%
C) 7%
D) 8%
Correct Answer:
Verified
Correct Answer:
Verified
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