Discount loan is paid, A Discount Loan is Paid. What is the

Discount loan is paid

Assignment Help Financial Management

Reference no: EM131913314

1. A Discount Loan is Paid:

As soon as possible

At the beginning of the year

Semi annually

At The end of the year

2. You are going to borrow $40,000 for one year, paying interest of $2,400 at the beginning of the year. The bank will require you to keep 10% of the borrowed funds in a non-interest bearing account at the bank during the life of the loan. What is the EFFECTIVE ANNUAL INTEREST RATE?

.5%

7.143%

8.43%

10%

Reference no: EM131913314

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