Question
A company will pay interest in the amount of $325,000 if $7,000,000 is borrowed from a line of credit. If the company would be required
A company will pay interest in the amount of $325,000 if $7,000,000 is borrowed from a line of credit. If the company would be required to maintain a $250,000 compensating balance and pay an up-front commitment fee of $6,000, what would be the effective annual interest rate on the lending arrangement?
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Multinational financial management
Authors: Alan c. Shapiro
10th edition
9781118801161, 1118572386, 1118801164, 978-1118572382
