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Financed with a debt-equity ratio

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You buy a machine worth $200,000 and finance it with a debt/equity ratio of 3. The debt is in the form of a term loan. You need to make equal annual payments of $30,080 for the next 8 years in order to fully repay the term loan. What is the interest rate on the loan? What is the question asking when it says "financed with a debt/equity ratio of 3"?

Reference no: EM132235144

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