A company needs to increase its working capital by (1,346,000 Riyals), the Chief Financial Officer (CFO) decided to get a one-year short-term loan from the bank at a discounted interest rate of (28.5%), note that is required to keep (11.7%) as a compensating balance. Calculate the Effective Interest Rate

A company needs to increase its working capital by (1,346,000 Riyals), the Chief Financial Officer (CFO) decided to get a one-year short-term loan from the bank at a discounted interest rate of (28.5%), note that is required to keep (11.7%) as a compensating balance. Calculate the Effective Interest 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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