Please answer all of the following questions. Do NOT use graphing, programmable calculators or cell phones...
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Please answer all of the following questions. Do NOT use graphing, programmable calculators or cell phones when solving examination problems. PVIF(A) factors are worth 75% of the assigned points. All loans herein are compounded monthly. Good Luck! 1. (Refinance Decision) Amount Terms Cost of Refinancing Original Loan $120,000 5%, 30 3%, New Loan $3,500 The original loan has been outstanding for 3 years. The owner plans to retain ownership of the property for another 8 years. The opportunity cost is 9%. Should the loan be refinanced? Remember to answer this question using Present Value (PV) Analysis. Please answer all of the following questions. Do NOT use graphing, programmable calculators or cell phones when solving examination problems. PVIF(A) factors are worth 75% of the assigned points. All loans herein are compounded monthly. Good Luck! 1. (Refinance Decision) Amount Terms Cost of Refinancing Original Loan $120,000 5%, 30 3%, New Loan $3,500 The original loan has been outstanding for 3 years. The owner plans to retain ownership of the property for another 8 years. The opportunity cost is 9%. Should the loan be refinanced? Remember to answer this question using Present Value (PV) Analysis.
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Answer rating: 100% (QA)
Since the NPV is negative the loan should not ve refinanced Interest ra... View the full answer
Related Book For
Introduction to Mathematical Statistics and Its Applications
ISBN: 978-0321693945
5th edition
Authors: Richard J. Larsen, Morris L. Marx
Posted Date:
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