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Question

A developer wants to buy a certain parcel of land. The developer believes she can afford payments of $\$ 44,000$ each half-year for the next $7$ years. How much can she borrow and hold to this budget at each of the following interest rates?

(a) $8.9 \%$ compounded semiannually

(b) $7.3 \%$ compounded semiannually

Solution

VerifiedAnswered 1 year ago

Answered 1 year ago

Step 1

1 of 14**a)**

The objective of this exercise is to calculate the amount of the loan that a developer can request, if she has a budget that allows her to return a fixed amount of money periodically to the bank, at a certain interest rate.

*According to what is reported in the exercise, what type of loan does the developer intend to request?*

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