Effective annual rate
Problem:
Firm A wants to borrow up to $350,000 from a bank at 15% p.a. There is a compensating balance requirement of 10%.
Required:
Question: What is the effective annual rate?
Note: Show all workings.
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Firm A wants to borrow up to $350,000 from a bank at 15% p.a. There is a compensating balance requirement of 10%. Question: What is the effective annual rate?
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