The Magic Pumpkin Limousine Company Wants to Purchase a Car

question 85

Essay

The Magic Pumpkin Limousine Company wants to purchase a car telephone system for one of its automobiles. The telephone vendor has offered to finance the $1,500 purchase over one year in 12 instalments, with a total of $140 in interest to be paid on the loan. Magic Pumpkin's bank has offered to finance the purchase with an instalment loan, where $155 in interest will be repaid and payments on the loan must be made quarterly. What are the annual interest rates on these loans?

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Definitions:

South America

A continent located in the Western Hemisphere, mostly in the Southern Hemisphere, with a diverse range of cultures, languages, and environments.

Value-Free Sociology

A principle stating that sociology should strive to be objective, unbiased, and non-judgmental in its research and findings, separating personal values from scientific analysis.

Objective

Something that one's efforts or actions are intended to attain or accomplish; purpose or goal.

Social Interactionist

focuses on understanding society through the study of how individuals interact and interpret their social world.