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2 Jun 2019
Which one of the following statements is correct?
The EAR is always greater than the APR.
The APR is equal to the EAR for a loan that charges interest monthly.
The APR on a monthly loan is equal to (1 + monthly interest rate)12 - 1.
The EAR, rather than the APR, should be used to compare both investment and loan options.
The APR is the best measure of the actual rate you are paying on a loan.
Which one of the following statements is correct?
The EAR is always greater than the APR.
The APR is equal to the EAR for a loan that charges interest monthly.
The APR on a monthly loan is equal to (1 + monthly interest rate)12 - 1.
The EAR, rather than the APR, should be used to compare both investment and loan options.
The APR is the best measure of the actual rate you are paying on a loan.
Beverley SmithLv2
4 Jun 2019