Response to the following problem:
A business plan to borrow $5 million for 12 months, and the bank gives you a stated 14 percent interest rate. What would be the effective rate interest for the following types of loans:
a. Simple 14 % interest with a 10% compensating balance?
b. Discounted interest?
c. Installment loan with 12 payments?
d. Discounted interest with a 5% compensating balance?