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Your company has arranged a revolving credit agreement for up to $82 million at an interest rate of 1.51 percent per quarter. The agreement also

Your company has arranged a revolving credit agreement for up to $82 million at an interest rate of 1.51 percent per quarter. The agreement also requires your company to maintain a compensating balance of 4 percent of the unused portion of the credit line to be deposited in a non-interest rate of .65 per quarter. What is the effective annual interest rate if your company borrows $47 million for one year?

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