Question content area top

Part $1$

Discount loan.$$Up$-$Front Bank is now offering a$$ two$-$year discount loan for $9\mathrm{.}5\%.$ Working$$ backwards, what are the available funds at the start of the loan and the implied balance at the end of the first year if the total$$ lump$-$sum repayment at the end of the second year is $$$$405,000?$ What is the EAR of this$$ loan?