Effective must be paid at the end of each year

Assignment Help Financial Management

Reference no: EM131891486

On a loan of $10,000 interest at 9% effective must be paid at the end of each year. The borrower also deposits $X at the beginning of each year into a sinking fund earning 7% effective. At the end of 10 years the sinking fund is exactly sufficient to pay off the loan. Calculate X.

Reference no: EM131891486

Questions Cloud

Fair premium for full coverage if competitive loading : What is the fair premium for full coverage if the competitive loading (administrative costs and capital costs) equals 15 percent of expected claim costs?

What is the most the lender will provide based on condition : If the maximum loan-to-value (LTV) ratio for the loan is 60%, what is the most the lender will provide based on this condition?

What is the value of the firm tax shield : What is the value of the firm's tax shield (i.e. the change in firm value due to the use of leverage in the capital structure)?

Find the present value of the venture in dollars : Find the present value of the venture in dollars (at Year 0) assuming a discount rate of 26%.

Effective must be paid at the end of each year : On a loan of $10,000 interest at 9% effective must be paid at the end of each year.

Valuation method that uses only terminal flow to investors : A valuation method that uses only a terminal flow to investors. Financing provided in sequences of rounds instead of all at once

What is the approximate duration of ten-year : What is the approximate duration of a 10-year, 7% coupon bond with annual coupons, a par value of $1,000 and a yield of 4%.

What is the bond price if the real inflation rate : What is the bond price if the real inflation rate is 2.863%?

Determine fixed and variable components of admitting costs : Use the scattergraph method to determine the fixed and variable components of admitting costs.

User Account

All Pages