You have an outstanding loan with an EAR of 14.6 percent.What is the APR if interest is compounded monthly?

Name: You have an outstanding loan with an EAR of 14.6 percent.What is the APR if interest is compounded monthly?
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Question

Quizplus · Accepted Answer

To convert EAR to APR compounded monthly, use the formula:
APR = [(1 + EAR/monthly)^12 - 1] x 100

Substituting the given values, we get:
APR = [(1 + 0.146/12)^12 - 1] x 100
APR = 13.71%

Therefore, the answer is choice B.

You Have an Outstanding Loan with an EAR of 14