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Use this information to answer all questions in this quiz: A borrower is faced with choosing between two FRM/CPM loans offered by a single lender.

image text in transcribed Use this information to answer all questions in this quiz: A borrower is faced with choosing between two FRM/CPM loans offered by a single lender. Loan A is available for $75,000 at 6% for 30 years with 6% in origination fees. Loan B would be made for the same amount but for 7% interest for 30 years with 2% in origination fees . All loans are fully amortizing. Question 2: If either loan is to be repaid after 20 years, what origination fee should the lender set on Loan A to ensure that Loan A and Loan B generate the same lender's yield? Express your origination fee as a percent. FOR EXAMPLE if your answer is 12.08% ENTER 12.08 in the numerical box below. Use this information to answer all questions in this quiz: A borrower is faced with choosing between two FRM/CPM loans offered by a single lender. Loan A is available for $75,000 at 6% for 30 years with 6% in origination fees. Loan B would be made for the same amount but for 7% interest for 30 years with 2% in origination fees . All loans are fully amortizing. Question 2: If either loan is to be repaid after 20 years, what origination fee should the lender set on Loan A to ensure that Loan A and Loan B generate the same lender's yield? Express your origination fee as a percent. FOR EXAMPLE if your answer is 12.08% ENTER 12.08 in the numerical box below

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