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The Bank of Loans uses the following rating scheme to classify the riskiness of its customers. Risk Class Prime High grade Upper medium grade Lower

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The Bank of Loans uses the following rating scheme to classify the riskiness of its customers. Risk Class Prime High grade Upper medium grade Lower medium grade Speculative: Non-investment grade Speculative: Highly Substantial risks Extremely speculative Risk Premium (%) 05 1.0 1.5 2.0 4.0 6.0 9.0 12.0 The bank's pure rate of interest is 1.5% and the inflation premium is 3% What rate would the bank offer a customer who is in the lower medium grade risk class? O A 8.21% B.7.16% OC.7.69% OD 10.31% OE. 8.74% OF. 6.64% OG 9.26% OH 9.79%

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