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A real estate firm can borrow money at %5 interest per year and can lend the money out. If the amount of money it can
A real estate firm can borrow money at %5 interest per year and can lend the money out. If the amount of money it can lend is inversely proportional to the square of the interest rate at which it lends, what interest rate would maximize the firms profit per year? (Hint: Notice that the profit is the product of the amount borrowed by the firm and the difference between the interest rates at which it lends and borrows).
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