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Question :
A small business received a five-year $1,000,000 loan at asubsidized : 148578

A small business received a five-year $1,000,000 loan at asubsidized rate of 3% per year. The firm will pay 3% annualinterest payment each year and the principal at the end of fiveyears. If market interest rates on similar loans are 6% per year,what is the NPV of the loan?

I know they use NPV to get an answer of 126,371, but how??

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Solution
5 (1 Ratings )

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