Answer: 92812.50
Explanation:
The following information can be derived from the question:
Loan principal = $1,500,000
LIBOR for 1st 6 months = 4.50%
LIBOR for last 6 months = 5.375%
Lending margin per annum = 1.25%
The interest will then be:
= 1,500,000 × [(4.50% + 1.25%)/2] + 1,500,000 × [(5.375% + 1.25%)/2]
= 1,500,000 × [(0.045 + 0.0125)/2] + 1,500,000 × [(0.05375 + 0.0125)/2]
= 92,812.50
Therefore, the interest is 92812.50.
