Acompany takes out a loan of 15,000,000 at an annual effective discount rate of 5.5%. you are given: i) the loan is to be repaid with n annual payments of 1,200,000 plus a drop payment one year after the nth payment. ii) the first payment is due three years after the loan is taken out. calculate the amount of the drop payment.

In the fall of 2008, aig, the largest insurance company in the world at the time, was at risk of defaulting due to the severity of the global financial crisis. as a result, the u.s. government stepped in to support aig with large capital injections and an ownership stake. how would this affect, if at all, the yield and risk premium on aig corporate debt?