Question
Metro bank offers one-year loans with a 9 percent stated rate, charges a percent loan origination fee, imposes a 10 percent compensating balance requirement, and
Metro bank offers one-year loans with a 9 percent stated rate, charges a percent loan origination fee, imposes a 10 percent compensating balance requirement, and must pay a 6 percent reserve requirement to the Federal Reserve. What is the return to the bank on these loans?
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Finance For Nonfinancial Managers
Authors: Gene Siciliano
2nd Edition
0071824367, 978-0071824361
