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Problem 2 A house buyer considers getting a mortgage that is either an annuity with a nominal coupon rate on 4% per year, annual payments
Problem 2 A house buyer considers getting a mortgage that is either an annuity with a nominal coupon rate on 4% per year, annual payments and maturity of 5 years or a coupon bond with a nominal coupon rate on 5,5% per year, annual payments and also a ma- turity of 5 years t(year1 yi(t) 2 3,0% 3 3,3% 4 3,4% 2,8% 5% Problem 2.3 Calculate the price of the annuity loan and of the mentioned coupon loan when the face value for both loans is assumed to be DKK 800.000
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