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You are asked to select one of the following choices as the best offer for borrowing $1,000,000 for one month. A bankers acceptance at 7%,

You are asked to select one of the following choices as the best offer for borrowing $1,000,000 for one month.

A bankers acceptance at 7%, an all-inclusive rate. Compute the effective cost of short-term borrowing.

7.5%

6.5%

8.5%

8.0%

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