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//WORKING CAPITAL MANAGEMENT Question 1. Dee's Christmas Trees, Inc., is evaluating options for financing its seasonal working capital needs. A short-term loan from Liberty Bank

//WORKING CAPITAL MANAGEMENT Question 1. Dee's Christmas Trees, Inc., is evaluating options for financing its seasonal working capital needs. A short-term loan from Liberty Bank would carry a 14% annual interest rate, with interest paid in advance (discounted). If this option were chosen, Dee's would also have to maintain a minimum demand deposit equal to 10% of the loan balance, throughout the term of the loan. If Dee's needs to borrow 125,000 for the upcoming three months before Christmas, what is the effective cost of the loan? Show your working outs step by step

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