If You Borrow $20 000 as a Five-Year Loan from the Bank

question 74

Multiple Choice

If you borrow $20 000 as a five-year loan from the bank and the bank requires you to make end-of-year payments of $4878.05,what is the annual interest rate on this loan?

• A)8 percent
• B)6 percent
• C)7 percent
• D)4 percent

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Definitions:

Distribution Network

A system of warehouses, transport services, and distribution centers that facilitates the movement of products from manufacturers to consumers.

Manufacturer

A company or individual that produces finished goods from raw materials using various processes, tools, and machinery.

Economies Of Scale

The cost advantage achieved by an increase in production, leading to a lower cost per unit.

Facilities

Physical locations or infrastructures where business operations occur, including offices, factories, and warehouses.