A bank loan has a quoted annual rate of 6%. However, the borrower must maintain a balance

Question:

A bank loan has a quoted annual rate of 6%. However, the borrower must maintain a balance of 25% of the amount of the loan, and the balance does not earn any interest.
a. What is the effective rate of interest if the loan is for one year and is paid off in one payment at the end of the year?
b. What is the effective rate of interest if the loan is for one month?

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