Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

If you have a $91,538 line of credit at 5.7%, and the compensating balance fee is 9%, what is the effective annual interest rate if

If you have a $91,538 line of credit at 5.7%, and the compensating balance fee is 9%, what is the effective annual interest rate if your average daily balance is $68,747?

Remember to express your answer in decimal format, not as a percentage. Therefore, if your answer is 7.65%, you should enter in 0.0765 with four significant digits after the decimal.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Business Analysis And Valuation Using Financial Statements

Authors: Krishna G Palepu, Paul M Healy

4th Edition

032430286X, 9780324302868

More Books

Students also viewed these Finance questions