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Jean takes out a loan to be repaid in 120 monthly payments of $3,000 each, the first payment being due one month after the date of the loan. The nominal annual interest rate is 6%, convertible monthly. Immediately after making the 60th payment, Jean negotiates to pay the bank a lump sum of $150,000 to pay off the loan. Determine the effective annual yield to the lender over the life of the loan. A B C D E Less than 5.0% At least 5.0%, but less than 5.3% At least 5.3%, but less than 5.6% At least 5.6%, but less than 5.9% At least 5.9%

Jean takes out a loan to be repaid in 120 monthly payments of $3,000 each, the first payment being due one month after the date of the loan. The nominal annual interest rate is 6%, convertible monthly. Immediately after making the 60 th payment, Jean negotiates to pay the bank a lump sum of $150,000 to pay off the loan. Determine the effective anmual yield to the lender over the life of the loan. B At least 5.0%, but less than 5.3% C At least 5.3%, but less than 5.6% D At least 5.6%, but less than 5.9% E At least 5.9% Jean takes out a loan to be repaid in 120 monthly payments of $3,000 each, the first payment being due one month after the date of the loan. The nominal annual interest rate is 6%, convertible monthly. Immediately after making the 60 th payment, Jean negotiates to pay the bank a lump sum of $150,000 to pay off the loan. Determine the effective anmual yield to the lender over the life of the loan. B At least 5.0%, but less than 5.3% C At least 5.3%, but less than 5.6% D At least 5.6%, but less than 5.9% E At least 5.9%

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