Question
A firm borrows a $30,000 from the bank at 13% compounded annually to purchase some new machinery. this loan is to be repaid in equal
A firm borrows a $30,000 from the bank at 13% compounded annually to purchase some new machinery. this loan is to be repaid in equal annual installments at the end of each year over the next 4 years. a). Evaluate how much each annual payment will be? b). set up an amortization schedule for a $30,000 loan to be repaid in equal installments at the end of each year, of the next 4 years. c) how much interest would be paid on this loan? ABZ corporation issued new 20 year bonds on January 1, 1990 the bonds sold at par (1000) and paid a 12% coupon annually. i) what was the bonds price and current yeild on January 1, 2000 assuming interest rates fell to 10%? ii) on January 1 2005 these bonds sold for K900 in the market. what was the YTM at that date?
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