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To start a new business, Alysha intends to borrow $ 2 5 , 0 0 0 from a local bank. If the bank asks her

To start a new business, Alysha intends to borrow $

25, 000

from a local bank. If the bank asks her to repay the loan in

5

equal annual instalments of $

6, 935.24,

determine the bank

s effective annual interest rate on the loan transaction. With annual compounding, what nominal rate would the bank quote for this loan?

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