How much interest will atlas pay on the loan in first year

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Reference no: EM131993149

1. Which of the following is true about a 10 year 8% bond with a face value of 1,000 that is selling for 1050?

(a) the yield to maturity is less than 8%

(b) the bond will pay $80 x 1050/1000 each year as interest

(d) none of the above

2. Atlas Juice company has just secured a $12,000,000 amortizing term loan from Walters Bank Corp. The loan is due at the end of 20 years and Atlas must make equal annual end of year payments on the loan. The annual interest rate on the loan is 8.5%. How much interest will Atlas pay on the loan in the first year?

a. $780,000.00

b. $941,292.18

c. $1,020,000.00

d. $340,000.00

Reference no: EM131993149

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