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1. You need a loan and your bank offers you two options: (1) borrow at a 15% interest rate compounded monthly; or (2) borrow at
1. You need a loan and your bank offers you two options: (1) borrow at a 15% interest rate compounded monthly; or (2) borrow at a 16% compounded semianually. Which is the better option for you?
2. Your bank is offering you a 30-year mortgage with an EAR of 10% and quarterly payments. If you plan to borrow $200,000, your monthly payment will be:
3.What is the price of a four-year zero-coupon (or pure discount) bond with a $100 face value and interest rate of 5.95%?
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