Computing effective rate of interest

Assignment Help Finance Basics

Reference no: EM1366653

Tucker Drilling Corporation wants to borrow $200,000. Northern National Bank will lend the money at one-half percentage point over the prime rate of 8 1/2% (9 percent total) & requires a compensating balance of 20%. Principal in this case refers to funds that the firm can effectively use in the business.

What is the effective rate of interest? What would the effective rate be if Tucker Drilling were required to make four quarterly payments to retire the loan?

Reference no: EM1366653

Questions Cloud

Identify the training objectives : Find the type of work sales representatives perform, check out the Occupational Outlook Handbook published by the U.S. Department of Labor

Comparing the marketing techniques : Compare and contrast marketing techniques among for profit vs. non-profit organizations.

Designing and implementing training solutions : Ideas presented in this solution can be used to initiate any training design and implementation project. As a guideline the TCA model has been introduced.

Compute value of shared secret key : You have secretly picked value SA = 17. You begin session by sending Bob your computed value of TA. Bob responds by sending you value TB = 291. What is the value of your shared secret key?

Computing effective rate of interest : Tucker Drilling Corporation wants to borrow $200,000. Northern National Bank will lend the money at one-half percentage point over the prime rate of 8 1/2% (9 percent total) & requires a compensating balance of 20%.

Reasons for unique increase in health care costs : The Part of gross domestic product that is created by the health care industry is growing faster than any other sector. WWrite down the three reasons for the unique increase in health care costs?

What is the control function of management : What is the control function of management and Why does the controlling function of management have a negative connotation?

Decision by wal-mart : What does this decision by Wal-mart tell you regarding the price elasticity of the demand curve that it faces?

Explain functionality of multiprogrammed system in user mode : In multiprogrammed system, must this functionality be available in user mode or only accessible by system call? Why or why not?

User Account

All Pages