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Suppose two firms want to borrow money from a bank for a period of one year. Firm A has excellent credit, whereas Firm B's credit
Suppose two firms want to borrow money from a bank for a period of one year. Firm A has excellent credit, whereas Firm B's credit standing is such that it would be required to pay prime +3 percent. The current prime rate is 6.81 percent, the 30 -year Treasury bond yield is 4.42 percent, the three-month Treasury bill yield is 3.49 percent, and the 10 -year Treasury note yield is 4.26 percent. What are the appropriate loan rates for each firm? Firm A loan rate %. Firm B loan rate %
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