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You just agreed to borrow $ 1 million to afford your dream home using a...

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Finance

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You just agreed to borrow $ 1 million to afford your dream home using a 30 year interest-only (10) loan, paid monthly in arrears as is normal. You were offered a rate of: 2.4% pa compounded monthly by Strict Bank that required lots of documentation to prove your income and expenses, and a rate of; 3.6% pa compounded monthly by Loose Bank that required almost no documentation and was a pleasure to deal with. You agreed to the more expensive rate loan with Loose Bank since you couldn't be bothered to gather the documentation, even though it would have only taken a moment. What was the net present value (NPV) of your decision to borrow using the more expensive interest rate compared to the cheaper one? Select one: O a. -$142,317.49 ob. $165,932.60 O c. -$232,934.34 O d. -$256,448.81 O e. -$360,000.00

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