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3 Question 13 (5 points) The bank has funded a loan to a firm. The loan terms include a base rate of 4%, a risk

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3 Question 13 (5 points) The bank has funded a loan to a firm. The loan terms include a base rate of 4%, a risk premium of 2%, an origination fee of 2625%, and a 6% compensating balance requirement. Required reserves at the Fed are 10%. What is the ROA on this loan? 5 of +(BR+0) 1+k=1+ 1-[b(1-RR)] 1 +k=1+ fy+f2 (1-td)+(BR +D)td td - [b(td)(1 - RR)] 6.62% 9.46% 6.26% 8%

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