(Related to Checkpoint 18.2) (Estimating the cost of bank credit) Paymaster Enterprises has arranged to finance its seasonal working-capital needs with a short-term bank loan. The loan will carry a rate of

1414

percent per annum with interest paid in advance (discounted). In addition, Paymaster must maintain a minimum demand deposit with the bank of

88

percent of the loan balance throughout the term of the loan. If Paymaster plans to borrow

$120 comma 000120,000

for a period of

33

months, what is the annualized cost of the bank loan?

The annualized cost of the bank loan is

nothing%.

(Round to two decimal places.)