Paul and Sandy Moede signed an $8,100 note at Citizen's Bank. Citizen's charges a 6.4% discount rate. Assume the loan is for 260 days. a. Find the proceeds. Note: Use 360 days a year. Round your intermediate calculations and final answer to the nearest cent. Proceeds b. Find the effective rate charged by the bank. Note: Use 360 days a year. Do not round intermediate calculations. Round your answer to the nearest tenth percent. Effective rate %

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter16: Working Capital Policy And Short-term Financing
Section: Chapter Questions
Problem 14P
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Paul and Sandy Moede signed an $8,100 note at Citizen's Bank. Citizen's charges a 6.4% discount rate. Assume the loan is for 260
days.
a. Find the proceeds.
Note: Use 360 days a year. Round your intermediate calculations and final answer to the nearest cent.
Proceeds
b. Find the effective rate charged by the bank.
Note: Use 360 days a year. Do not round intermediate calculations. Round your answer to the nearest tenth percent.
Effective rate
%
Transcribed Image Text:Paul and Sandy Moede signed an $8,100 note at Citizen's Bank. Citizen's charges a 6.4% discount rate. Assume the loan is for 260 days. a. Find the proceeds. Note: Use 360 days a year. Round your intermediate calculations and final answer to the nearest cent. Proceeds b. Find the effective rate charged by the bank. Note: Use 360 days a year. Do not round intermediate calculations. Round your answer to the nearest tenth percent. Effective rate %
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