Interest rate for discounting two options

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A mortgage borrower has an outstanding debt at interest rate of J12= 13,08% and 1.034 TL monthly payments for 69 months remaining today. Another bank is offering the same monthly payments but for 63 months only at a lower interest rate. For the refinancing, borrower has to pay 1.800 TL expense today. Decide if the borrower should refinance the debt or not by showing the difference of discounted values of two alternatives. (you must use the same interest rate for discounting two options to be able to compare)

Please do not use excel formulas and include the used formula in the solution.

Reference no: EM132524339

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