Assume That Stan Takes a Student Loan of $5 000

question 40

Essay

Assume that Stan takes a student loan of $5 000 at the beginning of his first year at Miskatonic University and graduates at the end of year 5. After graduation, a 7% interest rate on the debt is applied. If Stan makes four equal annual payments to re-pay the debt in four years after graduation, what is the IRR on his loan?

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Definitions:

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