Annual Percentage Rate

[Explain this!]

The cash price for an air condition is $150.00. The installment price is $170.10, payable in 18 equal monthly payments. What annual percentage rate is paid by the installment purchaser?
The amount financed per $100.00 is $20.10 divided by $150.00 multiplied by $100.00. The amount is $13.40. This amount is needed to determine the finance charge.

The answer is 16.25%, This percentage is found by using an APR table. My question is as follows:

How can the APR of 16.25% be determined by using a calculation?

 

[JeffM]

It can’t. It can be approximated using numerical methods, which is how your table is constructed.

 

[Explain this!]

It can’t. It can be approximated using numerical methods, which is how your table is constructed.

Do all APR tables use the same calculation method, or does each table us a different method?

 

[Deleted member 4993]

Do all APR tables use the same calculation method, or does each table us a different method?

Those tables "most probably" use the same method - but - that method cannot be reduced to simply evaluating some algebraic expression.

 

[JeffM]

Numerical methods are sophisticated methods of trial and error. They differ primarily in how many calculations are required to get a good approximation.