What is the annual repayment on the loan

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Reference no: EM131861974

A bank offers you a $1M loan with an IRR of 3%. (Recall from class that in this case you can interpret the IRR as a "borrowing rate".) The bank asks you to repay the loan in 8 equal annual installments.

a. What is the annual repayment on the loan?

b. What is the NPV of the loan if your opportunity cost of capital is 10%?

Reference no: EM131861974

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