Question
A loan of $100 million. Cost of equity: 8%, alocated equity 5%. Maturity 3 years. Corporate tax: 26%. Probability of Default is 1st year =
A loan of $100 million. Cost of equity: 8%, alocated equity 5%. Maturity 3 years. Corporate tax: 26%. Probability of Default is 1st year = 1%, 2nd year = 3%, 3rd year = 6%. What is the break-even rate and how much the bank should charge for the loan?
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Aircraft Finance Strategies For Managing Capital Costs In A Turbulent Industry
Authors: Bijan Vasigh, Reza Taleghani, Darryl Jenkins
1st Edition
1604270713, 9781604270716
