You have just borrowed $100,000 from a bank for a ten-year period. You will be making quarterly payments on this loan and the interest rate on the loan is 8% per annum with interest compounded quarterly. The principal balance outstanding at the end of the 12th quarter is closest to: Group of answer choices $56,133. $77,795. $78,338. $85,790.
Risk and return
Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.
Capital Asset Pricing Model
Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.
You have just borrowed $100,000 from a bank for a ten-year period. You will be making quarterly payments on this loan and the interest rate on the loan is 8% per annum with interest compounded quarterly.
The principal balance outstanding at the end of the 12th quarter is closest to:
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