When an auto loan's terms are 8% per year interest,seven years in length,and a purchase price of $20,000,what value should be entered in the Nper field?
A) 7
B) 7*12
C) .08/12
D) 20,000

Question

Quizplus · Accepted Answer

The Nper field in financial calculations represents the number of payment periods. In this case, the loan term is seven years, but the interest rate is given annually. Therefore, we need to convert the years to months by multiplying by 12. Thus, the total number of payment periods is 7*12=84 months. Therefore, the value to enter in the Nper field is B) 7*12.

When an Auto Loan's Terms Are 8% Per Year Interest,seven