What is the net present value of the loan

Assignment Help Financial Management
Reference no: EM131602008

TTC is planning to raise $3.25 million for three years at an interest rate of 7.35 percent to finance their expansion. The Alban County Board of Commissioners has just offered the firm the $3.25 million they need at 5.25 percent if the firm builds in Alban County, pays the interest annually, and repays the principal at the end of three years. What is the net present value of the loan to TTC if the firm’s tax rate is 34 percent and it accepts the county’s offer?

Reference no: EM131602008

Questions Cloud

How will the impact future terrorism efforts relying : How was this vaccine developed, and how is it administered? How will this impact future terrorism efforts relying on disbursement of inhalation anthrax?
What impact does crime analysis have on geographic profiling : What impact does crime analysis have on geographic profiling. Should crime analysis personnel be drawn from the ranks of sworn or civilian personnel
Discuss and analyse the growth of hubbards foods : BSRE301 Business Strategy Assessment - Group Presentation and Report. Discuss and analyse the growth of Hubbard's Foods since it was established
Explain internet exploitation and primary federal law : Explain Internet Exploitation and Primary Federal Law, types of online traps that have the most adverse impact on children
What is the net present value of the loan : What is the net present value of the loan to TTC if the firm’s tax rate is 34 percent and it accepts the county’s offer?
What will be the expected return for your portfolio : What will be the expected return for your portfolio?
List two advantages and disadvantages of job specialization : List two advantages and disadvantages of job specialization. What aspects of Taylorism have you encountered in any jobs you have had?
Find the surface area s as a function of r : A closed cylindrical can of fixed volume V has radius r. Find the surface area, S, as a function of r.
How did james dozier showed emotional intelligence : Section Can emotional intelligence save your life Read "Case study" (P. 9). How did James Dozier showed Emotional Intelligence?

Reviews

Write a Review

Financial Management Questions & Answers

  Summarize the main points of the article

Investors expect that the return on a risky bond to an investor will be higher than the return on bonds with less risk.

  Defined as secondary market transaction

This would be defined as a secondary market transaction, not a primary market transaction.

  Ethical practices in faces of internal or external pressures

Select a publicly-traded firm of your choice that enjoys a solid shareholder base and launched within the past 10 years. What challenges has this firm encountered (or is likely to encounter) in terms of 1) incorporating ethics into financial manageme..

  Like to make single investment

Sarah Wiggum would like to make a single investment and have ?$1.6 million at the time of her retirement in 28 years. She has found a mutual fund that will earn 5 percent annually. How much will Sarah have to invest? today? If Sarah earned an annual ..

  How much are you willing to pay for the stock

If your required rate of return is 15%, how much are you willing to pay for the stock?

  Cost of borrowing the maximum amount of credit available

MDM Inc. is considering factoring its receivable. The firm has credit sales of $600,000 per month and an average receivable balance of $600,000 with net 90 credit terms. What is the cost of borrowing the maximum amount of credit available to MDM Inc...

  Calculate the NPV and IRR without mitigation

A mining company is considering a new project. Because the mine has received a permit, the project would be legal; but it would cause significant harm to a nearby river. Calculate the NPV and IRR with mitigation. Calculate the NPV and IRR without mit..

  What should be forward price for no arbitrage opportunity

Given this information, what should be forward price for no arbitrage opportunity?

  Discuss the pros and cons of option

Merit Enterprise Corp. Sara Lehn, chief financial officer of Merit Enterprise Corp., was reviewing her presentation one last time before her upcoming meeting with the board of directors. Discuss the pros and cons of option 1, and prioritize your thou..

  Funded an irrevocable trust with dividend paying stock

Jan funded an irrevocable trust with $3 million of dividend paying stock. She gave her husband Jeremy a life estate in the trust. The trust directs that upon Jeremy's death the remainder will be paid to Jan, if she is living or to her daughter Esther..

  What is the size of the money multiplier

Assume a financial system has a monetary base (MB) of $25 million. The required reserves ratio is 10 percent, and no leakages are in the system. a. What is the size of the money multiplier (m)? b. What will be the system’s money supply?

  Important factor to consider when seeking venture capitalist

Which of the following are important factors to consider when seeking a venture capitalist?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd