+1-415-670-9189
info@expertsmind.com
How much is your monthly interest payment
Course:- Financial Management
Reference No.:- EM13942903




Assignment Help
Assignment Help >> Financial Management

You have a line of credit arrangement which allows you to borrow up to $80 million at any time. The interest rate is 0.63% per month. The arrangement also requires a compensating balance equal to 6% of the amount borrowed which must be placed in a non-interest-bearing account. The bank uses compound interest on its LOC loans.

a. If you borrow the entire line, how much will you actually be able to use?

b. How much is your monthly interest payment? What is your periodic interest rate and EAR? c. If you need $19 million and repay it in 10 months, how much interest will you pay?




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Financial Management) Materials
The gamma and vega of a delta-neutral portfolio are 75 per $ and 15 per %, respectively. What will happen to the value of the portfolio when there is a shock to the market cau
You buy an at-the-money call option on ABC Corporation common stock, which has a strike price of $15.00 and a premium of $2.83. What must happen to the price of ABC stock for
Stanley Roper has $2,500 that he is looking to invest. His brother approached him with an investment opportunity that could give Patrick $4,700 in 4 years. What interest rate
You have been managing a $900,000 portfolio that has a beta of 1.50 and a required rate of return of 15%. The current risk-free rate is 3.00%. Assume that you receive another
Suppose that the average variance rate during the life of an option has a 0.20 probability of being 0.06, a 0.5 probability of being 0.09, and a 0.3 probability of being 0.1
You are currently working in a mid-size certified public accounting firm. Your client is Bob Jones. Bob, age 60 and single, has recently retired from IBM. He has $690,000 avai
What are the financial statements presented in the report and how many disclosures are in the report and what was the net income of the company? Explain the revenues and the e
You are evaluating two investment alternatives (to be your only investment along with riskfree assets). One is a passive market portfolio with an expected return of 10% and a