What is the capital charge factor for a loan with an interest rate of 7% for...

What is the capital charge factor for a loan with an interest rate of 7% for 25 years? Make sure to answer to at least three significant figures .

Expert Solution

Given in the question,

r = 7% = 7/100 = 0.07

n = 25

Capital charge factor = [1-(1+r)^-n]/r

= [1-(1+0.07)^-25]/0.07 (Substituting the value from above)

= [1-(1.07)^-25]/0.07

= [1-(1/1.07)²⁵]/0.07

= [1-(1/5.4274)]/0.07

= [1-0.1842]/0.07

= 0.8158/0.07

=11.654

Please give likes for the work. Thanks & Regards.

ekkarill92 answered 1 year ago

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