Question

Jed wants to borrow ​$1,000 from you. He is proposing to repay you with three annual...

Jed wants to borrow

​$1,000

from you. He is proposing to repay you with three annual payments of

​ $347.03

starting one year from

now.

In​ addition, he will make a final​ lump-sum payment of

​$120

three years from

today.

What rate of return are you earning on the​ loan?

What rate of return are you earning on the​ loan?

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Answer #1

Rate of Return = 7.4506%

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