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City Loans Wants to Earn an Effective Annual Return on Its

Question 102

Multiple Choice

City Loans wants to earn an effective annual return on its consumer loans of 18.9 percent per year.The bank applies daily compounding.What interest rate is the firm required by law to report to potential borrowers?


A) 17.47 percent
B) 17.32 percent
C) 17.86 percent
D) 16.39 percent
E) 18.90 percent

Correct Answer:

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