Dee%u2019s Christmas Trees, Inc., is evaluating options for financing its seasonal working-capital needs. A short-term loan from Liberty Bank would carry a 14% annual interest rate, with interest paid in advance (discounted). If this option is chosen, Dee%u2019s would also have to maintain a minimum demand deposit equal to 10 percent of the loan balance, throughout the term of the loan. If Dee%u2019s needs to borrow $125,000 for the upcoming three months before Christmas, what is the effective cost of the loan?