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The value of a property is 10. The loan balance is 5 with the interest rate of 10%. For simplicity it is the interest-only loan.
The value of a property is 10. The loan balance is 5 with the interest rate of 10%. For simplicity it is the interest-only loan. Without using mortgages, the equity investment return rate is 20%. Then, the investment return rate with using mortgages is X%. Calculate the value of X. (Hint: Use the formula that we learned in our lecture.)
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