medium · Private Credit & Debt loan-structures-instruments
A mezzanine lender provides a 25M loan with 8% cash interest and 4% PIK interest.
Assuming interest is compounded annually, what is the outstanding principal balance at the end of Year 2 (excluding cash interest payments)?
- $31.48M
- $27.00M
- $27.04M
- $26.00M
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