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A company borrows $110000, which will be paid back to the lender in one payment at the end of 8 years. The company agrees to
A company borrows $110000, which will be paid back to the lender in one payment at the end of 8 years. The company agrees to pay yearly interest payments at the nominal annual rate of 7% compounded yearly. At the same time the company sets up a sinking fund in order to repay the loan at the end of 8 years. The sinking fund pays interest at an annual nominal interest rate of 11% compounded yearly. Find the total amount of the yearly payments, that is, the sum of the interest payment and the sinking fund payment. Total yearly payment = $
A company borrows $110000, which will be paid back to the lender in one payment at the end of 8 years. The company agrees to pay yearly interest payments at the nominal annual rate of 7% compounded yearly. At the same time the company sets up a sinking fund in order to repay the loan at the end of 8 years. The sinking fund pays interest at an annual nominal interest rate of 11% compounded yearly. Find the total amount of the yearly payments, that is, the sum of the interest payment and the sinking fund payment.
Total yearly payment = $
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Corporate Finance Investment And Advisory Applications
Authors: Jesse McDougall, Patrick Boyle
1st Edition
1530116597, 9781530116591
