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The research project according to the evaluation of the experts will be spread over a period of 4 years. The annual funding required to conduct this research is $100,000 at the beginning of each year. The firm has set a term of 7 years to raise the necessary funds to finance this research, the nominal interest rate is 8% capitalized quarterly.
a. How much does the company need to save at the end of each month to fund this research in 7 years?
b. Draw the timeline for this financing plan by presenting all the relevant elements.
If the firm wants to start financing the research project today t=0, by taking out a bank loan equal to the VA of all the financing needs of the research project (for the 4 years).
c. Calculate the amount of monthly payments that the firm must pay to repay this bank loan for a period of 5 years?
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