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Palm Beach Yachts has a line of credit with a local bank that permits it to borrow up to $1.8 million at any time. The

Palm Beach Yachts has a line of credit with a local bank that permits it to borrow up to $1.8 million at any time. The interest rate is .78 percent per month. The bank charges compound interest and also requires that 5 percent of the amount borrowed be deposited into a non-interest-bearing account. What is the effective annual interest rate on this loan?

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