a. What interest rate would make it worthwhile to incur a compensating balance of $16,000 in order to get a 1-percent lower interest rate on a 1-year, pure discount loan of $255,000? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.) Interest rate %
a. What interest rate would make it worthwhile to incur a compensating balance of $16,000 in order to get a 1-percent lower interest rate on a 1-year, pure discount loan of $255,000? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places.) Interest rate %
Fundamentals of Financial Management (MindTap Course List)
14th Edition
ISBN:9781285867977
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Eugene F. Brigham, Joel F. Houston
Chapter5: Time Value Of Money
Section: Chapter Questions
Problem 27P: EFFECTIVE VERSUS NOMINAL INTEREST RATES Bank A pays 4% interest compounded annually on deposits,...
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