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Question 1: The following information is given about a Loan: Por probability of repayment 93% (1-P) Probability of default 7% LGD, or Loss Given Default

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Question 1: The following information is given about a Loan: Por probability of repayment 93% (1-P) Probability of default 7% LGD, or Loss Given Default 60% (1-LGD) or Recovery Amount 40% Rf or risk-free rate 4% RP or Risk Premium 4% Assuming the Lender wants a risk premium of 4%, what will be the rate charged by the lender? Input your answer to 4 decimal places, enter 14.26% as .1426

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