A businessman borrowed P 50,000 today from bank with interest rate of 8% compounded quarterly repayable in equal quarterly installment for 10 years. Payments made at the end of each quarter.  Find the quarterly payment.


2. X Corp would like to borrow from Y Corp. The risk free rate is 6% with current inflation rate of 2%. In the following year the inflation rate will increase by 1%. How much is the interest rate that Y  should impose to X?


3. A 1,000 Treasury bills with 91 days period can be purchased at 995. What is the annualized discount rate?

Answer rating: 100% (QA)

a To find the quarterly payment for the loan we can use the formula for the equal quarterly installment EMI on a loan The formula is EMI P r 1 rn 1 rn ... View the full answer