Doris wade purchased a condominium for $50,000 in 1987. her down payment was $20,000she financed the remaining amount as a $30,000, 30-year mortgage at 7%, compounded monthlyher monthly payments are $200. it is now 2007 (20 years later) and doris has sold the condominium for $100,000, immediately after making her 240th payment on the unither effective annual internal rate of return on this investment is closest to which answer below? (a) 3.6% (b) 8.5% (c) 5.3% (d) 1.5%

Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan

Ithink its 3! hope it : -)