Question

a student has a total of 2000 in student loan that will be paid with 48 month installment loan with monthly payments of 49.30 determine the apr of the loan

Answer 1

Given that

A student has a total of 2000 in student loans that will be paid with 48 monthly installment loan with monthly payments of 49.30.

Explanation -

The total loan amount is 2000 and he pays 49.30 monthly installments for 48 months.

Then the amount he paid back will be

Amount = 48 x 49.30 = 2366.4

Let the APR is x%.

Then,

$\begin{gathered} 2000+x\text{ \% of 2000 = 2366.4} \\ x\text{ \% of 2000 = 2366.4 - 2000 = 366.4} \\ \frac{x}{100}\times2000=366.4 \\ x=\frac{366.4}{20}=18.32 \end{gathered}$

So the APR will be 18.32%.

Hence the final answer will be 18.32%.