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A small business received a six-year $2,000,000 loan at a subsidized rate of 3% per year. The firm will pay 3% annual interest payment each
A small business received a six-year $2,000,000 loan at a subsidized rate of 3% per year. The firm will pay 3% annual interest payment each year and the principal at the end of six-year. If market interest rates on similar loans are 6% per year, what is the NPV of the loan? (Ignore taxes.)
A) +$126,371
B) +147,520
C) +348,369
D) -501,595
E) -137,391
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