Assume that Ningbo Steel borrows $1,000,000 for one year under a line of credit with a stated interest rate of 7.5 percent and a 15 percent compensating balance and that the firm keeps no money on deposit in its checking account. Based on this information, the effective annual interest rate on the loan is
A) 8.8%.
B) 15.0%.
C) 22.5%.
D) 8.2%.
E) none of the above
Correct Answer:
Verified
Q133: In general, a firm that secures a
Q134: The _ is the lowest rate of
Q135: The _ is the lowest rate of
Q136: In general, a firm that secures a
Q137: In general,
A)a revolving credit agreement is more
Q138: Commercial banks lend unsecured short-term funds in
Q139: Bank loans on which interest is paid
Q140: Commercial banks lend unsecured short-term funds in
Q141: Assume that Ningbo Steel borrows $2,000,000 for
Q142: In general,
A)a revolving credit agreement is equally
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents