Question: please solve this step by step, as I have my exams tommorow. 7. Ref: GM 17:26 (Class teams to do) Q-Consider a $2 million, 7.5%,

please solve this step by step, as I have my exams tommorow.

7. Ref: GM 17:26 (Class teams to do) Q-Consider a $2 million, 7.5%, 30 year mortgage with monthly payments and an expected realistic prepayment horizon of eight years. What is the contractual yield (effective interest rate) at issuance over the expected life of the loan under the following circumstances? a. No points or penalties b. 1 point of disbursement discount c. 2 points of disbursement discount d. 2 points of disbursement discount plus 1 point of prepayment penalty

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