Question
ABCD LTDA sells chemical products to other companies. HGTS LTDA, negotiates a purchase of several products totaling R$ 750,000.00 to be paid in three installments.
ABCD LTDA sells chemical products to other companies. HGTS LTDA, negotiates a purchase of several products totaling R$ 750,000.00 to be paid in three installments. They are due at the end of 3 months, 5 months and 7 months. Payments will be made at the bank through bonds and the linear interest rate charged is 18% per annum. The first installment (bond) to be paid will have the value of 30% of the outstanding balance. The second installment (bond) will be 40% of the debit balance, and the last installment (bond) will be 40% of the debit balance. Knowing this information, answer:
a) What is the value of each installment paid on the scheduled date?
b) The bank negotiates with ABCD LTDA an administration fee of 0.8% on the amount paid by HGTS LTDA for each security (tranche). Therefore, how much will the bank transfer to ABCD LTDA?
c) Answer this question based on the values calculated in letter a. In case HGTS LTDA prepays the bonds, the discount rate is 1.2% per month. Therefore, what is the amount paid by HGTS LTDA to the bank, and the latter passed it on to ABCD LTDA, if the second installment was paid 15 days before maturity?
d) Based on the answer to letter c), what will be the new value of the third installment? And how much will the bank transfer to ABCD LTDA of the third installment? Did ABCD LTDA make a good deal by paying the 2nd installment in advance?
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