Suppose that a loan of R$6,000,000.00 must be paid monthly as follows: From the 10th to the 100th month, 10 installments of R$426,143.00 From the 110th to the 130th month, 3 installments of R$3,621,378.00 What is the monthly interest rate built into this plan?
Suppose that a loan of R$6,000,000.00 must be paid monthly as follows: From the 10th to the 100th month, 10 installments of R$426,143.00 From the 110th to the 130th month, 3 installments of R$3,621,378.00 What is the monthly interest rate built into this plan?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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36- Suppose that a loan of R$6,000,000.00 must be paid monthly as follows:
From the 10th to the 100th month, 10 installments of R$426,143.00
From the 110th to the 130th month, 3 installments of R$3,621,378.00
What is the monthly interest rate built into this plan?
Expert Solution
Step 1
We have quantum and timing of cash flows emanating from a loan. We have to find the IRR per period and then the monthly interest rate.
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