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Solution_for_Assignment_6

# Solution_for_Assignment_6 - Assignment 6 Solutions Loan...

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Assignment 6 Solutions: Loan 10,000,000 Discount 8% Coupon Rate 10.00% prepay 10.00% Beginning Balance Payment Interest 1 \$10,000,000 \$1,627,453.95 \$1,000,000 2 \$8,435,291.45 \$1,464,708.55 \$843,529 3 \$7,032,700.83 \$1,318,237.70 \$703,270 4 \$5,775,959.90 \$1,186,413.93 \$577,596 5 \$4,650,427.76 \$1,067,772.54 \$465,043 6 \$3,642,928.20 \$960,995.28 \$364,293 7 \$2,741,603.17 \$864,895.75 \$274,160 8 \$1,935,780.96 \$778,406.18 \$193,578 9 \$1,215,857.58 \$700,565.56 \$121,586 10 \$573,190.00 \$630,509.00 \$57,319 Rate of return Price 9% \$10,342,643.07 A 10% \$10,000,000.00 11% \$9,676,525.24 Security price \$3,771,088.88 Some of you used 10% c if 10%, 10%, 10% Make sure to understand Market rate, Market intere Make sure you use Begin Loan 10,000,000 Discount 10.00% Rate 9.50% prepay 10.00% Beginning Balance Payment Interest 1 \$10,000,000 \$1,627,453.95 \$1,000,000 2 \$8,435,291.45 \$1,464,708.55 \$843,529 3 \$7,032,700.83 \$1,318,237.70 \$703,270 4 \$5,775,959.90 \$1,186,413.93 \$577,596 5 \$4,650,427.76 \$1,067,772.54 \$465,043 6 \$3,642,928.20 \$948,751.17 \$346,078 7 \$2,736,229.69 \$853,876.05 \$259,942 8 \$1,928,065.91 \$768,488.45 \$183,166 9 \$1,208,469.35 \$691,639.60 \$114,805 10 \$568,470.91 \$622,475.64 \$54,005 Rate of return Price

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B. Security price \$3,560,927.59 if 9.5%, 10%, 10% Loan 10,000,000 Discount 8.00% Rate 9.50% prepay 20.00% Beginning Balance Payment Interest 1 \$10,000,000 \$1,627,453.95 \$1,000,000 2 \$8,435,291.45 \$1,464,708.55 \$843,529 3 \$7,032,700.83 \$1,318,237.70 \$703,270 4 \$5,775,959.90 \$1,186,413.93 \$577,596 5 \$4,650,427.76 \$1,067,772.54 \$465,043 6 \$3,642,928.20 \$948,751.17 \$346,078 7 \$2,432,204.17 \$759,000.94 \$231,059 8 \$1,523,410.10 \$607,200.75 \$144,724 9 \$848,746.65 \$485,760.60 \$80,631 10 \$354,893.59 \$388,608.48 \$33,715 Rate of return Price C. Security price \$3,718,258.46 if 9.5%, 20%, 8% 2.) a.) Tranche A
Tranche B b.) Tranche A Tranche B

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Amort End Bal Before Prepay prepayment Cash Flow \$627,453.95 \$9,372,546.05 \$937,254.61 \$2,564,708.55 \$621,179.41 \$7,814,112.04 \$781,411.20 \$2,246,119.76 \$614,967.62 \$6,417,733.22 \$641,773.32 \$1,960,011.02 \$608,817.94 \$5,167,141.96 \$516,714.20 \$1,703,128.12 \$602,729.76 \$4,047,698.00 \$404,769.80 \$1,472,542.34 \$596,702.46 \$3,046,225.74 \$304,622.57 \$1,265,617.86 \$590,735.44 \$2,150,867.73 \$215,086.77 \$1,079,982.53 \$584,828.08 \$1,350,952.87 \$135,095.29 \$913,501.47 \$578,979.80 \$636,877.78 \$63,687.78 \$764,253.34 \$573,190.00 \$0.00 \$0.00 \$630,509.00
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Solution_for_Assignment_6 - Assignment 6 Solutions Loan...

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