Question: You plan to borrow $1,000,000 for 5 years for the purchase of a small apartment building. You secure a floating rate, interest only loan. The

You plan to borrow $1,000,000 for 5 years for the purchase of a small apartment building. You secure a floating rate, interest only loan. The index rate is 3% and the margin is 2%. What will be the interest payment in year 1?

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