You have just arranged a six-year bank loan for $150,000 at an interest rate of 9%...

You have just arranged a six-year bank loan for $150,000 at an interest rate of 9% p.a. with interest compounded quarterly. The loan will be repaid in equal quarterly installments and the first payment will be due one quarter from today. Assuming end-of-the-period cash flows, the principal amount repaid to the bank at the end of the first quarter will be closest to:

Group of answer choices

$3,375.

$4,890.

$4,782.

$3,267.

Solutions

Expert Solution

Given information

1) ban loan = $ 150,000

2) Rate of interest = 9% p.a

means 9/4 = .0225 per quarter

3) loan term = 6 years

Answer is option "C' means $4,782

jeff jeffy answered 1 year ago

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