Compute the specified quantity.A 4-year bond costs $20,000 and will pay a total of $2,800 in interest over its lifetime. What is its annual interest rate r? (Round your answer to three decimal places.)r = ___%

Compute the specified quantity.A 4-year bond costs $20,000 and will pay a total of $2,800 in interest over its lifetime. What is its annual interest rate r? (Round your answer to three decimal places.)r = ___%

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section4.17: Amortized Loans

Problem 1ST

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Compute the specified quantity.

A 4-year bond costs $20,000 and will pay a total of $2,800 in interest over its lifetime. What is its annual interest rate r? (Round your answer to three decimal places.)
r = ___%

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