A what is the annual repayment on the loan b what is the


A bank offers you a $1M loan with an IRR of 3%. (Recall from class that in this case you can interpret the IRR as a "borrowing rate".) The bank asks you to repay the loan in 8 equal annual installments.

a. What is the annual repayment on the loan?

b. What is the NPV of the loan if your opportunity cost of capital is 10%?

Solution Preview :

Prepared by a verified Expert
Finance Basics: A what is the annual repayment on the loan b what is the
Reference No:- TGS02657472

Now Priced at $20 (50% Discount)

Recommended (90%)

Rated (4.3/5)