Question
A lender issues a $190 loan to a borrower. There is a 85% chance the borrower will make the full required loan repayment, and a
A lender issues a $190 loan to a borrower. There is a 85% chance the borrower will make the full required loan repayment, and a 15% chance that the borrower will make a repayment of only $50. What is lowest loan repayment (principal + interest) the lender can afford to charge?
| $215 |
| $211.9 |
| $202.5 |
| $200 |
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Enterprise Risk Management In Finance
Authors: David L. Olson, Desheng Dash Wu
1st Edition
1349691038, 978-1349691036
