A bank is preparing to issue a $9,000 loan to a borrower who will repay the...
A bank is preparing to issue a $9,000 loan to a borrower who will repay the loan in full with probability 0.86 and default otherwise. If the bank offers a competitive interest rate, what is the loan repayment amount? *Round to the 1,000ths place
A) $10,467
B) $10,888
C)$10,910
D) $11,111
Homework Answers
Loan Repayment Amount = $9000/probability
= $9000/0.86 = $10,467
Therefore (A) $10,467 is the answer for this question.
Add Answer to:
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