Question
A XYZ bank lends a firm $5,000,000 for one year at 12 percent on a discounted basis and requires compensating balances of 10 percent of
A XYZ bank lends a firm $5,000,000 for one year at 12 percent on a discounted basis and requires compensating balances of 10 percent of the face value of the loan. The effective annual interest rate associated with this loan is __________.
A. 6.67 %
B. 7.69%
C. 6.41%
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Airline Finance
Authors: Peter S. Morrell
4th Edition
1351959743, 978-1351959742
