User Account

All Pages

What is the actual rate you are paying on this loan

Assignment Help Finance Basics
Reference no: EM131401626

You are looking at a one-year loan of $200,000. The interest rate is quoted as 6 percent plus 5 points. A point on a loan is simply 1 percent (one percentage point) of the loan amount. Quotes similar to this one are very common with home mortgages. The interest rate quotation in this example requires the borrower to pay 5 points to the lender up front and repay the loan later with 6 percent interest. What is the actual rate you are paying on this loan?

Reference no: EM131401626

Questions Cloud

Main sections of the statement of cash flows : There are three main sections of the Statement of Cash Flows, (1) Cash Flow from Operations, (2) Cash Flow from Investing Activities, and (3) Cash Flow from Financing Activities. What are the implications of negative balances for each of the three..
What is the firm''s degree of financial leverage (dfl) : Stumpy's Gator Farm forecasts that its net income will be $46,800 this year. The firm's marginal tax rate is 35 percent, and it must pay $36,000 interest on outstanding debt. Stumpy's has no preferred stock. What is the firm's degree of financial ..
Forward exchange rate : Suppose that the annual interest rate is 5.0 percent in the United States and 3.5 percent in Germany, and that the spot exchange rate is $1.12/€ and the forward exchange rate, with one-year maturity, is $1.16/€.
Discuss what potential issues or challenges you could face : If you were a poultry farmer, which system(s) would you utilize to raise your birds. Explain why and discuss what potential issues/challenges you could face by utilizing this system?
What is the actual rate you are paying on this loan : The interest rate quotation in this example requires the borrower to pay 5 points to the lender up front and repay the loan later with 6 percent interest. What is the actual rate you are paying on this loan?
What is archware net income : Archware Systems has total assets of $35.594 billion, total debt of $9.678 billion, and net sales of $22.430 billion. Their net profit margin for the year was 0.17, while the operating profit margin was 30 percent. What is Archware's net income? (..
Discuss the features that uniquely suit the organism : Find an example of the weirdest, wildest, most bizarre or interesting species you can. Discuss those features that uniquely suit this organism to survival within a given set of environmental conditions.
Importance of the archangel michaels prophecy : Relate these observations to the conversation between Michael, Adam, and Eve on the pages assigned (924-927), taking into account the diction and rhythm of the poem. Be sure to quote and cite correctly.
Common stock of silver corp : The next year the common stock of Silver Corp will pay a dividend of $9.64 per share. If the company is growing at a rate of 4.69 percent per year, and your required rate of return is 10.39 percent, what is Silver company stock worth to you? Round..

Reviews

Write a Review

Finance Basics Questions & Answers

  Bank evaluation process

Assume that you are nearing graduation and have applied for a job with a local bank. The bank's evaluation process requires you to take an examination that covers several financial analysis techniques. The first section of the test asks you to add..

  Determine what the dividend payout ratio must be

Nearside, Inc. wishes to maintain a growth rate of 12% per year and a debt-equity ratio of .30. Profit margin is 6.7%, and the ratio of total assets to sales is constant at 1.35. Is this growth rate possible? To answer, determine what the dividend pa..

  Briefly explain the difference in the manner

Identify the fundamental distinction between a futures contract and an option contract, and briefly explain the difference in the manner that futures and options modify portfolio risk.

  Discuss the short term and long term effects of foreigners

Since the early 1980s, foreign portfolio investors have purchased a significant portion of U.S. Treasury bond issues. Discuss the short-term and long-term effects of foreigners' portfolio investment on the U.S. balance of payments.

  Asymmetric information theory of capital structure

Which of the following statements concerning the asymmetric information theory of capital structure is false?

  Commute distance for all california commuters

An investigator claims, with 95 percent confidence, that the interval between 10 and 16 miles includes the mean commute distance for all California commuters. To have 95 percent confidence signifies that:

  What is the variable cost per unit

Month Units produced Total costs March 10,000 $25,600 April 12,000 26,200 May 19,800 27,600 June 13,000 26,450 July 12,000 26,000 August 15,000 26,500 Using the high-low method, what is the variable cost per unit?

  For each of the following annuities calculate the annual

for each of the following annuities calculate the annual cash flow. enter rounded answers as directed but do not use

  How many shares need to be sold

The SEC filing fee and associated administrative expenses of the offering are $1,450,000. (Enter your answer as directed, but do not round intermediate calculations.)

  What are the companys capital structure weights on a book

What are the company's capital structure weights on a book value basis?

  What are the advantages of matching the maturities of

what are the advantages of matching the maturities of assets and liabilities? what are the

  Assume that you are considering the purchase of a 15-year

assume that you are considering the purchase of a 15-year bond with an annual coupon rate of 9.5. the bond has face

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd