27. Your firm has taken out a $500,000 loan with 9% APR (compounded monthly) for some commercial...
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27. Your firm has taken out a $500,000 loan with 9% APR (compounded monthly) for some commercial property. As is common in commercial real estate, the loan is a five-year loan based on a 15-year amortization. This means that your loan payments will be calculated as if you will take 15 years to pay off the loan, but you actually must do so in five years. To do this, you will make 59 equal payments based on the 15-year amortiza- tion schedule and then make a final 60th payment to pay the remaining balance.
a. What will your monthly payments be?
b. What will your final payment be?
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Related Book For
Fundamentals Of Corporate Finance
ISBN: 9781292018409
3rd Global Edition
Authors: Berk, Peter DeMarzo, Jarrad Harford
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