Author Question: Detta borrows 20,000 from the bank. For a five-year loan, the bank requires annual end-of-year ... (Read 54 times)

armygirl · **on:** Jul 10, 2018

Detta borrows 20,000 from the bank. For a five-year loan, the bank requires annual end-of-year payments of 4,878.05. The annual interest rate on the loan is ________.

A) 6 percent
B) 7 percent
C) 8 percent
D) 9 percent

Question 2

Asset P has a beta of 0.9. The risk-free rate of return is 8 percent, while the return on the market portfolio of assets is 14 percent. The asset's required rate of return is ________.

A) 13.4 percent
B) 22.0 percent
C) 15.4 percent
D) 6.0 percent