2. If the current inflation rate is 5%, then the normal rate necessary for you to earn an 8% real interest rate on your investment is closest to:

  1. A truck costing $112000 is paid off in monthly installments over four years with 8% APR. After three years the owner wishes to sell the truck. What is the closest amount from the following list that he needs to pay on his loan before he can sell his truck?

A. $24867

B. $28678

C. $31432

D. $87255

  1. If the current inflation rate is 5%, then the normal rate necessary for you to earn an 8% real interest rate on your investment is closest to:

A. 13.0%

B. 13.4%

C. 4.9%

D. 3.0%

Summary

These short questions basically belong to Finance. The 1st question is about computing the remaining loan amount necessary to sell a truck bought on loan. The 2nd question is about calculating interest rate on investments.

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