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Suppose that Zimbabwe has a choice oftwo possible $100 million, five-year Eurodollar loans. The first loan is offered at LIBOR + 1% with a 2.5%
Suppose that Zimbabwe has a choice oftwo possible $100 million, five-year Eurodollar loans. The first loan is offered at LIBOR + 1% with a 2.5% syndication fee, whereasthe second loan is priced at LIBOR + 1.5% and a 0.75% syndication fee. Assuming that Zimbabwe has a 9% cost of capital, which loan is preferable
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