Schoene Lighting Company is borrowing 2 million. The loan will be repaid in equal quarterly installments for the next 3 years. The interest rate is 9% APR. Schoene incurs 10,000 of loan setup costs at time zero, and it must also make an insurance payment of 1.5% of the remaining loan balance at the first of each of the three years. What are the APR and APY on the loan?
Schoene Lighting Company is borrowing 2 million. The loan will be repaid in equal quarterly installments for the next 3 years. The interest rate is 9% APR. Schoene incurs 10,000 of loan setup costs at time zero, and it must also make an insurance payment of 1.5% of the remaining loan balance at the first of each of the three years. What are the APR and APY on the loan?
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 17P
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(excel :loan interest rate) Schoene Lighting Company is borrowing 2 million. The loan will be repaid in equal quarterly installments for the next 3 years. The interest rate is 9% APR. Schoene incurs 10,000 of loan setup costs at time zero, and it must also make an insurance payment of 1.5% of the remaining loan balance at the first of each of the three years.
What are the APR and APY on the loan?
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