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QUESTION 5 1.A bank is charging a rate of 12.00% on a loan, and the probability of default is 5% with a 60% salvage value.What

QUESTION 5

1.A bank is charging a rate of 12.00% on a loan, and the probability of default is 5% with a 60% salvage value.What is the highest required return such that this loan would be made?

9.76%

9.00%

10.64%

10.05%

9.17%

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