Answer:
the closest answer choice is A) 8.30%.
Step-by-step explanation:
To calculate the effective annual rate (EAR) for a loan with a stated APR of 8% compounded monthly, we can use the following formula:
EAR = (1 + (APR/n))^n - 1
where APR is the stated annual percentage rate, and n is the number of times the interest is compounded per year.
In this case, APR = 8% and the interest is compounded monthly, so n = 12.
Plugging in the values, we get:
EAR = (1 + (0.08/12))^12 - 1
≈ 0.0862 or 8.62% (rounded to the nearest hundredth)
Therefore, the closest answer choice is A) 8.30%.