(Calculating an EAR?) You have a choice of borrowing money from a finance company at 23 percent compounded monthly or borrowing money from a bank at 25 percent compounded quarterly. Which alternative is the most? attractive?
If you can borrow funds from a finance company at 23 percent compounded monthlymonthly?, the EAR for the loan is _____?(Round to two decimal? places.)
If you can borrow funds from a bank at 25 percent compounded quarterly?, the EAR for the loan is ______. ?(Round to two decimal? places.)
Based on the findings? above, which alternative is more? attractive? (Select the best choice? below.)
A. The loan from the finance company at 23% compounded monthly
B. The loan from the bank at 25% compounded quarterly.