Knique Shoes issued a $100,000, 8-month, "noninterest-bearing note." The loan was made by Second Commercial Bank whose stated "discount rate" is 9%. The effective interest rate on this loan is:
A) 9.28%
B) 9.49%
C) 9.50%
D) 9.57% $100,000 9% 8/12 = $6,000
$6,000 / ($100,000 $6,000) = 6.38%
3) 38% 12/8 = 9.57%
Correct Answer:
Verified
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