Question
The Ohio Valley Steel Corporation has borrowed $7 million for one month at a stated annual rate of 9% (APR, compounded monthly), using inventory stored
The Ohio Valley Steel Corporation has borrowed $7 million for one month at a stated annual rate of 9% (APR, compounded monthly), using inventory stored in a field warehouse as collateral. The warehouse charges a $7,000 fee, payable at the end of the month. What is the effective annual rate of this loan?
Answer: The effective annual rate is ________%. (Round to two decimal places.)
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Fundamentals Of Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
5th Global Edition
1292437154, 978-1292437156
