(Calculating an EAR) You have a choice of borrowing money from a finance company at 24 percent compounded annually or borrowing money from a bank at 26 percent compounded daily. Which alternative is the mostattractive?
If you can borrow funds from a finance company at 24 percent compounded annually, the EAR for the loan is ___________ %. ?(Round to two decimal places.)
If you can borrow funds from a bank at 26 percent compounded daily, 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 24 % compounded annually
B. The loan from the bank at 26 % compounded daily.