A bank offered a commercial customer a one-year loan. A discounted note with a nominal rate of 13% is the instrument. What is the borrower's effective interest rate? 13.20% 14.94% 12.00% 10.71% 13.64%

A bank offered a commercial customer a one-year loan. A discounted note with a nominal rate of 13% is the instrument. What is the borrower's effective interest rate? 13.20% 14.94% 12.00% 10.71% 13.64%

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 21MC: A customer takes out a loan of $130,000 on January 1, with a maturity date of 36 months, and an...

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A bank offered a commercial customer a one-year loan. A discounted note with a nominal rate of
13% is the instrument. What is the borrower's effective interest rate?
13.20%
14.94%
12.00%
10.71%
13.64%
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