Assignment Information

1. Due Date

Points Possible

100

  You are the CEO of a hospital and you need to finance new advanced equipment that will
cost $100,000. You have the option of a $100,000 standard loan or a discounted loan, both at a
4% annual rate with a one-year maturity date.

In a one- to three-page paper, explain the difference between a standard loan and a discounted
loan. What would the effective rate be for the discount loan? Identify which loan you would
choose and the reasons why. Would your decision change if the equipment only cost $95,000?
Why or why not?

Your paper must follow APA Style formatting throughout.

Review the rubric for specific grading criteria.

Points: 100