July 17, 2014, Billy Prater borrowed $58,500 from his grandfather to open a clot

Question

                            July 17, 2014, Billy Prater borrowed $58,500 from his grandfather to                         

                            open a clothing store. Starting July 17, 2020, Billy has to make 10                         

                            equal annual payments of $8,773 each to repay the loan. Use a financial                         

                            calculator to determine what interest rate Billy is paying. (Round answer to 2 decimal places, e.g.                             25.25%.)
                            
                        

                                        Interest rate                                                                              
                                                                                                                           %                                         

Explanation / Answer

Borrowed mount = PV = 58,500

No of payments = nper =10

Payment = PMT = 8773

So Interest Rate = Rate(nper,pmt,pv,fv)

= Rate(10,-8773,58500,0)

= 8.14%

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