A $10,000 loan can be repaid quarterly for 5 years using amortization and an interest rate ofj12=

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A $10,000 loan can be repaid quarterly for 5 years using amortization and an interest rate ofj12= 10% or by a sinking fund to repay both principal and accumulated interest. If paid by a sinking fund, the interest on the loan will bej12= 9%.

What annual effective rate must the sinking fund earn to make the quarterly cost the same for both methods?

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Financial Reporting Financial Statement Analysis and Valuation a strategic perspective

ISBN: 978-1337614689

9th edition

Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

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Posted Date: May 14, 2024 01:53 AM

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A $10,000 loan can be repaid quarterly for 5 years using amortization and an interest rate ofj12=

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Financial Reporting Financial Statement Analysis and Valuation a strategic perspective

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