What is the yield to maturity on a simple loan for $1 million that requires a...

What is the yield to maturity on a simple loan for $1 million that requires a repayment of $2 million in 14 years’ time? State the answer as a number with 2 decimals without % sign. For example, 5.55 is a correct answer, while 5.55% or 0.055 are not correct.

Expert Solution

PV = - $1 million

FV = $2 million

N = 14

PMT = 0

Inputting these values in the financial calculator, then "CPT", "I/Y", we get,

I/Y = 5.07%

Therefore, Answer = 5.07

jeff jeffy answered 2 years ago

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