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b) With a quoted interest rate of 4% and a 6% compensating balance, what is the effective rate of interest (use a $100000 loan proceeds

b) With a quoted interest rate of 4% and a 6% compensating balance, what is the effective rate of interest (use a $100000 loan proceeds amount)? (4 Marks for correct calculation and 1 Mark for correct answer to equal a total of 5 Marks)

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