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The Furniture Place spent $10000 to refurbish its current facility The firm borrowed 60 percent of the refurbishment cost at 80% percent interest for 3 years and the loan calls for three equal

  • The Furniture Place spent $10.000 to refurbish its current facility. The firm borrowed 60 percent of the refurbishment cost at 8.0% percent interest for 3 years and the loan calls for three equal annual payments. Prepare the amortization schedule for the three year loan. How much total interest is paid in 3 years?

 

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  • 2. RG Coffee House issued a $1,000 par value bond that pays a 9 percent interest annually. The bond matures in 14 years and is currently selling at $1,120. Your required rate of return is 8.5 percent.
  • a. Compute the bond’s expected rate of return.
  • b. Determine the value of the bond to you, given your required rate of return.
  • c. Should you purchase the bond? Why?
 

Jun 02 2020 Read more Less More

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