Prof. Alessandro Gavazza of London School of Economics on mortgages, cars and market friction
Scientific Sense ®
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Is There a Standardized Way of Looking at the APR?
In the US there is some way that they say they can put everything together into a singular number and that is more easily digested. Is there anything like that in the UK? Yes, absolutely. So the APR is a way of summarizing different fees and different interest rates. Although very often the interest rate is a lot more salient for consumers than I let you to the APR.
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