Billy Thornton borrowed $240,000 at a rate of 7.25%, simple interest, with interest paid at the end of each month. The bank uses a 360-day year. How much interest would Billy have to pay in a 30-day month?

Select the correct answer.

a. $1,453.60

b. $1,451.80

c. $1,448.20

d. $1,450.00

e. $1,446.40

Pacific Bank pays a 9.25% nominal rate on deposits, with monthly compounding. What effective annual rate (EFF%) does the bank pay?

Select the correct answer.

a. 9.65%

b. 10.15%

c. 9.40%

d. 9.90%

e. 9.15%