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Your bank has offered you a loan which will allow you to purchase some warehouse space. The bank is willing to lend you $750,000. You will make monthly payments of $7,500 per month starting one month from today. After six years (72 payments), you will still owe $400,000 and you can pay it off or refinance it with a new loan from the bank at that time. If you accept the terms of this loan, what is the interest rate you will be paying for the next six years? Express your answer as a monthly rate, and APR, and an EAR. Your bank has offered you a loan which will allow you to purchase some warehouse space. The bank is willing to lend you $750,000. You will make monthly payments of $7,500 per month starting one month from today. After six years (72 payments), you will still owe $400,000 and you can pay it off or refinance it with a new loan from the bank at that time. If you accept the terms of this loan, what is the interest rate you will be paying for the next six years? Express your answer as a monthly rate, and APR, and an EAR.
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Monthly Rate The monthly rate is calculated by finding the periodic rate bas... View the full answer
Related Book For
Finance Applications and Theory
ISBN: 978-0077861681
3rd edition
Authors: Marcia Cornett, Troy Adair
Posted Date:
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