Accounting for Decision Making and Control 6th Edition by Jerold Zimmerman

Exercise 15

You are considering buying a $50,000 car. The dealer has offered you a 13.6 percent loan with 30 equal monthly payments. On questioning him, you find that the interest charge of $17,000 (or 0.136X$50,000 X2.5 years) is added to the $50,000 for a total amount of $67,000. The payments are $2,233.33 a month ($67,000
30). What is the approximate effective annual interest rate