A small business refits its store.The builders charge them $125,000,which will be paid back in monthly installments over three years at 6% APR.The builders will reduce this rate to 5.5% APR if they pay $2500 up front.By approximately how much will this reduce the monthly loan repayments ?

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The reduction in APR from 6% to 5.5% will decrease the monthly payment. Calculating the monthly payments for both rates and finding the difference gives approximately $104.

A Small Business Refits Its Store