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County Bank offers one - year loans with of 9 per cent stated or base rate but requires a compensating balance of 1 0 per
County Bank offers oneyear loans with of per cent stated or base rate but requires a compensating balance of per cent. What is the true cost of this loan to the borrower? How does the cost change if the compensating balance is per cent? If the compensating balance is per cent? Hint: true cost loan rate : compensating balance rate
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