Eden finances a purchase of $611.03 by making monthly payments of $26.17 for 2 1/2 years. What annual interest rate, compounded monthly, is she being charged?

Answer 1

26.17( 1 - (1+i)^-30)/i = 611.03

1 - (1+i)^-30 = 23.3485i

I don't know how your course expects you to solve for this, there are several ways that fall under the topic of
"numerical methods"

Online Wolfram is excellent ...
http://www.wolframalpha.com/input/?i=solve+26.17%281+-+%281%2Bx%29%5E-30%29%2Fx+%3D+611.03

to get i = .017 (I changed it to x, since Wolfram interpreted i as √-1 )

So the annual rate is appr .017(12) = .204
or 20.4 % per annum compounded monthly

check
26.17(1 - 1.017^-30)/.017
= 611.03 , how is that ????