Financed with two alternatives

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A house costing $100,000 can be financed with two alternatives: A. $80,000, 15 yr, 11.5%, 1pt. B. $90,000, 20 yr, 12%, 2pts. If the house will be sold in 18 years, use the Incremental borrowing cost to find a. real cost of additional $10,000 loan proceeds per Loan B b. return on the additional $10,000 equity interested in Loan A

Reference no: EM13978924

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