Answer:
15%
Explanation:
For computing the annual interest rate we need to apply the RATE formula i.e to be shown in the attachment below;
Given that,
Present value = $25,000
Future value or Face value = $0
PMT = $1,212.17
NPER = 24 months
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after applying the above formula,
The annual interest rate is
= 1.25% × 12 months
= 15%
