EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN: 9781337514835
Author: MOYER
Publisher: CENGAGE LEARNING - CONSIGNMENT
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General accounting

ABC Manufacturing plans to borrow $500,000 from a bank for one
year. The nominal interest rate is 8 percent, and the bank requires a
compensating balance of 20 percent. What is the effective rate of
interest?
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Transcribed Image Text:ABC Manufacturing plans to borrow $500,000 from a bank for one year. The nominal interest rate is 8 percent, and the bank requires a compensating balance of 20 percent. What is the effective rate of interest?
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