Paymaster Enterprises has arranged to finance its seasonal working-capital needs with a short-term bank loan. The loan will carry a rate of 12 percent per annum with interest paid in advance (discounted). In addition, Paymaster must maintain a minimum demand deposit with the bank of 9 percent of the loan balance throughout the term of the loan. If Paymaster plans to borrow $110,000 for a period of 4 months, what is the effective cost of the bank loan? Hint: Assume the Paymaster does not have sufficient funds in the bank to satisfy the compensating balance requirement. The effective cost, or APR, of the bank loan is?