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how many discount points are necessary to raise the yield of a 12% loan with 360 monthly payments of $514.30 to 12.42%?

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tutorconsortium271

Discount points of 3.06% are required to boost the yield on a loan with a 12% interest rate and 360 payment of $514.30 a month to 12.42%.

How would you define "discount explain"?

A dollar amount or a % deducted from an item's typical selling price is referred to as a discount. Make sure that need all of the items you plan to get before waiting after the holiday to make a purchase.

What is the discount procedure?

A value obtained in the future is replaced by an equivalent benefits created right away through the process of discounting. Discounting determines this relative value, so a dollar received in 50 years may be actually quite low received today.

Briefing:

Present value of loan=PV(12%/12,12*30,514.3)

=50000

PV(12.42%/12.12*30,514.3)

=48470

Discount=50000 - 48470

=1530

So discount points=1530/50000

Discount points =3.06%

To know more about discount visit:

https://brainly.com/question/15208981

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