Response:
The value of the loan subsidy at 5% is $1,000,000, while at 10% it stands at $500,000.
Clarification:
The government offers a subsidized perpetual loan of $1,000,000
with an interest rate of 5%.
The annual payment for this is $50,000.
The following calculation determines the worth of the loan subsidy perpetually.
The total subsidy loan value at 5% is found by $50,000 / 5% = $1,000,000.
For the subsidy loan at 10%, it is $50,000 / 10% = $500,000.
The value of the loan subsidy at 5% is $1,000,000, and at 10% it is $500,000.