User Account

All Pages

Which terms are better if the firm intends to borrow

Assignment Help Finance Basics
Reference no: EM131069426

Bank A offers the following terms for a $10 million loan:

* interest rate: 8 percent for one year on funds borrowed

* fees: 0.5 percent of the unused balance for the unused term of the loan Bank B offers the following terms for a $10 million loan:

* interest rate: 6.6 percent for one year on funds borrowed

* fees: 2 percent origination fee

a. Which terms are better if the firm intends to borrow the $10 million for the entire year?

b. If the firm plans to use the funds for only three months, which terms are better?

Reference no: EM131069426

Questions Cloud

Calculate width of space charge region for applied voltages : Find the built-in potential for a p-n Si junction at room temperature if the bulk resistivity - calculate the width of the space charge region for the applied voltages
Importance in the planning process : There are eight (8) steps in planning a formative evaluation. Select one (1) step and determine its importance in the planning process for your project. Predict the possible impact if you omit the step. Provide two (2) examples to support your sel..
Recommend at least two strategies an administrator can apply : Recommend at least two strategies an administrator can apply to ensure that the budget is performing according to the established performance indicators. Justify your response.
Problems in a process-oriented organization : In this week's Journal, discuss how you can apply your creative and imaginative skills to solve problems in a process-oriented organization.
Which terms are better if the firm intends to borrow : Which terms are better if the firm intends to borrow the $10 million for the entire year? If the firm plans to use the funds for only three months, which terms are better?
What is the maximum profit that the company can earn : Budget Auto produces inexpensive cars. Each car is sold for US$7,900. The raw material in a car costs US$5,000. What is the maximum profit that the company can earn during the next six month
What were the professions of the authors : How many articles were selected? Did they explain the inclusion criteria of the selected articles? Do they provide a table that summarizes the results?
Port facility infrastructure and port facility operations : In considering Port Facilities, what are the unique safety challenges posed to port facility infrastructure and port facility operations?
Identify a health program in jena louisiana : A detailed explanation of the characteristics of the population that the program serves. An analysis of the reasons for implementing the program in this particular locality and population.

Reviews

Write a Review

 

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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