On 1/1/87, Cathy borrows $1,000 from ABS Finance Company and agrees to repay it in five annual

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On 1/1/87, Cathy borrows $1,000 from ABS Finance Company and agrees to repay it in five annual installments at an effective annual rate of 11%.

The first payment is due one year after the loan is issued. On 1/1/89, Cathy pays off the loan balance plus a $50 prepayment penalty.

Find the effective overall rate of return of ABC .

Related Book For answer-question

Intermediate Accounting

ISBN: 978-0077400163

6th edition

Authors: J. David Spiceland, James Sepe, Mark Nelson

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Posted Date: May 17, 2023 08:17 AM

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On 1/1/87, Cathy borrows $1,000 from ABS Finance Company and agrees to repay it in five annual

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To find the effective overall rate of return of the loan we need to calculate the total amount repai... View the full answer

Intermediate Accounting

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