Finance School of management Providing Information Price information that helps coordinate decentralized decision-making in various sectors of the economy You are 30 years old, just got married, and want to buy a house for $100,000 Your local bank will make you a mortgage loan for $80,000 at an interest rate of 8%o per year but you need to pay 20%0 Your 45-year-old sister has a savings account with $20,000 in it for her retirement, earning 6%o per year If your sister is willing to lend you her retirement savings for your down payment, how do you decide what a fair rate of interest rate? uesTc20 Finance School of Management Providing Information ❖ Price information that helps coordinate decentralized decision-making in various sectors of the economy – You are 30 years old, just got married, and want to buy a house for $100,000. – Your local bank will make you a mortgage loan for $80,000 at an interest rate of 8% per year, but you need to pay 20% down. – Your 45-year-old sister has a savings account with $20,000 in it for her retirement, earning 6% per year. – If your sister is willing to lend you her retirement savings for your down payment, how do you decide what a “fair” rate of interest rate?