Multiple Choice
TABLE 8.2
Use the information for Polaris Corporation to answer the following question(s) .
Polaris is taking out a $5,000,000 two-year loan at a variable rate of LIBOR plus 1.00%. The LIBOR rate will be reset each year at an agreed upon date. The current LIBOR rate is 4.00% per year. The loan has an upfront fee of 2.00%
-Refer to Table 8.2.What is the all-in-cost (i.e.,the internal rate of return) of the Polaris loan including the LIBOR rate,fixed spread and upfront fee?
A) 4.00%
B) 5.00%
C) 5.53%
D) 6.09%
Correct Answer:
Verified
Correct Answer:
Verified
Q2: TABLE 8.2<br>Use the information for Polaris Corporation
Q3: TABLE 8.2<br>Use the information for Polaris Corporation
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