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If Highland Commercial Bank (HCB) enters that market with a marginal tax rate of 25%, and a dividend payout of 20%, and they can obtain

  1. If Highland Commercial Bank (HCB) enters that market with a marginal tax rate of 25%, and a dividend payout of 20%, and they can obtain funding at 3.00%, what will be their retained earnings spread if they have the same credit card price of 8.40%?
  2. What credit price would HCB have to implement in order to match Champion's retained earnings spread?

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