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On January 1, 2020, Lynn Company borrows P2,000,000 from National Bank at IT % annual interest. addition, Lynn is required to keep a compensatory balance

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On January 1, 2020, Lynn Company borrows P2,000,000 from National Bank at IT % annual interest. addition, Lynn is required to keep a compensatory balance of P200,000 on deposit at National Bar which will earn interest at 5%. The effective interest that Lynn pays on its P2,000,000 loan is A) 10.0%. B) 11.0%. 11.5%. D) 11.6%

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