I want to know monthly payment with percentage. Let's say I took loan of $200 and I have to pay monthly for 5 months and amount pay back is $260. Over here $60 is interest. I could make out that I have to pay $52 each month to make $260 at the end of 5 months. Kindly help to calculate percentage
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Loan equation is
s = (d - d (1 + r)^-n)/r
s = principal n = number of periods d = periodic payment s = 200 n = 5 d = 260/n ∴ r = 0.0943489 per period 12 r = 1.13219
So the APR is 113% nominal, compounded monthly.
The effective annual rate is 195%.
(1 + 0.0943489)^12 - 1 = 1.95032
Plot or solver is required to obtain