Your firm is considering two one-year loan options for a $531,000 loan. The first carries fees of
Question:
Your firm is considering two one-year loan options for a $531,000 loan. The first carries fees of 1.9% of the loan amount and charges interest of 4% of the loan amount.
The other carries fees of 1% of the loan amount and charges interest of 4.1% of the loan amount.
a. What is the net amount of funds from each loan?
b. Based on the net amount of funds, what is the true interest rate of each loan?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (1 review)
Loan Analysis a Net Amount of Funds Loan 1 Loan amount 531000 Fee rate 19 Interest rate 4 Fee amount ...View the full answer
Answered By
Aysha Ali
my name is ayesha ali. i have done my matriculation in science topics with a+ . then i got admission in the field of computer science and technology in punjab college, lahore. i have passed my final examination of college with a+ also. after that, i got admission in the biggest university of pakistan which is university of the punjab. i am studying business and information technology in my university. i always stand first in my class. i am very brilliant client. my experts always appreciate my work. my projects are very popular in my university because i always complete my work with extreme devotion. i have a great knowledge about all major science topics. science topics always remain my favorite topics. i am also a home expert. i teach many clients at my home ranging from pre-school level to university level. my clients always show excellent result. i am expert in writing essays, reports, speeches, researches and all type of projects. i also have a vast knowledge about business, marketing, cost accounting and finance. i am also expert in making presentations on powerpoint and microsoft word. if you need any sort of help in any topic, please dont hesitate to consult with me. i will provide you the best work at a very reasonable price. i am quality oriented and i have 5 year experience in the following field.
matriculation in science topics; inter in computer science; bachelors in business and information technology
_embed src=http://www.clocklink.com/clocks/0018-orange.swf?timezone=usa_albany& width=200 height=200 wmode=transparent type=application/x-shockwave-flash_
4.40+
11+ Reviews
14+ Question Solved
Related Book For
Fundamentals Of Corporate Finance
ISBN: 9781292437156
5th Global Edition
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
Question Posted:
Students also viewed these Business questions
-
Last Sale Net Bid Ask Open Int Puts Last Sale Net bid Ask Vol Open Int 16Aug 155.00(1619H155-E) 6.45 0.75 6.95 7.25 9 16Aug 155.00(1619T155-E) 1.18 (0.75) 1.17 1.25 61 4505 16Aug 166.00(1619H160-E)...
-
Your firm is considering two one-year loan options for a $500,000 loan. The first carries fees of 2% of the loan amount and charges interest of 4% of the loan amount. The other carries fees of 1% of...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
A 110 g hockey puck sent sliding over ice is stopped in 15 m by the frictional force on it from the ice. (a) If its initial speed is 6.0m/s, what is the magnitude of the frictional force? (b) What is...
-
For each function, sketch the graphs of the function when c = 4, 1, 2, and 5 on the same set of coordinate axes. (a) f(x) = [[x]] + c (b) f(x) = [[x + c]]
-
A flow field is simulated by a computational fluid dynamics code that uses the modified pressure in its calculations. A profile of modified pressure along a vertical slice through the flow is...
-
Calculate the interquartile range for each of the following sets of data: a. \(3,6,7,12,15,17,23,28\) b. \(8,4,1,6,13,10,12,5\) c. \(3,8,14,11,16,7,14,15,11,9,12,6\) d....
-
I. M. Aruban has a sandwich shop in a downtown business district. Several of his customers have said that they would purchase from his shop more often if he offered a delivery service. I. M. is...
-
Analyse effective leadership strategies for enhancing performance in public enterprises. Use practical examples from the Namibian corporate sector to illustrate your answers.
-
Your firm is issuing $98 million in straight bonds at par with a coupon rate of 5.5% and paying total fees of 2.9%. What is the net amount of funds that the debt issue will provide for your firm?
-
You are finalizing a bank loan for $205,000 for your small business and the closing fees payable to the bank are 1.7% of the loan. After paying the fees, what will be the net amount of funds from the...
-
In addition to purchasing raw materials a manufacturer also purchased a quantity of finished goods. The cost of carriage inwards on the raw materials was incorrectly recorded as carriage inwards on...
-
Giselle is performing a market review for a copyeditor position at her company. She has already identified benchmark jobs at other companies, matched job descriptions, and pulled information on pay...
-
Explain the role of Explanations of Benefits (EOBs) and Medicare Summary Notices (MSNs) in educating consumers.
-
Assume ABC Inc. had the following sales data in 2025: Cost of goods sold = $856,000 Non-operating expenses = $31,000 Operating expenses = $92,000 Sales revenue = $1,219,000 Unrealized gains = $20,000...
-
What is the main difference between traditional and activity-based costing-systems in warehouse management? please explain.
-
Pine Company declared a property dividend of 20,000 shares of $1 par Polk Company common stock. The Polk stock was purchased for $5 per share. The fair value of Polk's stock was $10 per share on the...
-
Bubba is a shrimp farmer. In an ironic twist, Bubba is allergic to shellfish, so he cannot eat any shrimp. Each day he has a one-ton supply of shrimp. The market price of shrimp is $10,000 per ton....
-
The following information is for Montreal Gloves Inc. for the year 2020: Manufacturing costs Number of gloves manufactured Beginning inventory $ 3,016,700 311,000 pairs 0 pairs Sales in 2020 were...
-
Under standard accounting rules, it is possible for a companys liabilities to exceed its assets. When this occurs, the owners equity is negative. Can this happen with market values? Why or why not?
-
Under standard accounting rules, it is possible for a companys liabilities to exceed its assets. When this occurs, the owners equity is negative. Can this happen with market values? Why or why not?
-
Suppose a companys cash flow from assets is negative for a particular period. Is this necessarily a good sign or a bad sign?
-
You are considering the following two mutually exclusive investment projects: Year 0 1 2 3 4 Project A -$200,000 $40,000 $60,000 $80,000 $153,500 Project B -$50,000 $25,000 $22,000 $15,000 $20,120...
-
The following is a news item reported by Reuters: WASHINGTON, January 29 (Reuters)- Orville Medical Group, a maker of reconstructive implants for knees and hips, on Tuesday filed to sell 4 million...
-
An entrepreneur has access to two mutually exclusive investment projects (project A and project B). Both projects cost $60 million today. One year from now Project A generates a cash flow of $90...
Study smarter with the SolutionInn App