Question: Can you please explain how to solve this problem? Mr. Tramp made a mortgage 5 years ago for $75,000 at 6% interest and a 10

Can you please explain how to solve this problem? Mr. Tramp madeCan you please explain how to solve this problem?

Mr. Tramp made a mortgage 5 years ago for $75,000 at 6% interest and a 10 year term. Rates have now risen to 7% for an equivalent loan. Mr. Tramp's lender is willing to discount the loan by $2,500 if he will prepay the loan. What rate of return would Mr. Tramp receive by prepaying the loan? 8.21% 8.52% 790%

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