Your firm can borrow from its bank for 1 month. The loan will have to be rolled over at the end of the month but you are sure the rollover will be allowed. The simple interest rate 14%, but interest will have to paid at the end of the month, so the bank interest rate 14% , monthly compounding. Alternatively, your firm can borrow from an insurance company at a simple interest rate that would involve quarterly compounding. While simple quarterly rate would be equivalent to the rate charge by the bank ? =