On November 30, Year One, a company borrows $1 million from a bank on a seven-month note paying an annual stated interest rate of 6 percent (the prime interest rate on that date). When the note comes due on June 30, Year Two, the company pays the bank the interest and refinances the $1 million with a new seven month note at the current prime rate. The company and the bank continue to follow this pattern for years: The interest