Your firm intends to finance the purchase of a new construction crane.The cost is $2,500,000.What is the size of the first payment if the crane is financed with an interest-only loan at an annual rate of 7.50%?
A)$187,500.00
B)$127,500.00
C)$3,391,475.16
D)There is not enough information to answer this question.

Question

Quizplus · Accepted Answer

The first payment for an interest-only loan would be the annual interest on the total amount borrowed. This is calculated as $2,500,000 * 7.50% = $187,500.00.

Your Firm Intends to Finance the Purchase of a New