You have a choice of borrowing money from a finance company at 24 percent compounded quarterly or borrowing money from a bank at 26 percent compounded annually. Which alternative is the most attractive?
If you can borrow funds from a finance company at 24% compounded quarterly, the EAR for the loan is what %.
If you can borrow funds from a bank at 26% compounded annually, the EAR for the loan is what %?
What is the better option?