Question
To promote Norwegian culture in South America, a record company that specializes in old dance has received a subsidized loan from the state. The size
To promote Norwegian culture in South America, a record company that specializes in old dance has received a subsidized loan from the state.
The size of the loan is NOK 772,173.49. The loan is an annuity loan that must be repaid over 10 years. Interest and installments are paid at the end of each year. The interest rate on the loan is 5% p.a. The interest rate on similar loans with a bank is 8% p.a. The record company is not in a tax position. What is the value of the subsidy?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
To calculate the value of the subsidy we need to compare the interest expense of the subsidized loan ...
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Global Strategy
Authors: Mike W. Peng
5th Edition
0357512367, 978-0357512364
