Sask Seed Wishes to Borrow $3 Million for Two Months

question 17

Multiple Choice

Sask Seed wishes to borrow $3 million for two months.Using its inventory as collateral,it can obtain a 9% (APR) loan.The lender requires that a warehouse arrangement be used,with a warehouse fee of $9,000,payable at the end of the month.What is the firm's EAR for this loan?

• A)17.4%
• B)21.6%
• C)11.3%
• D)9.3%
• E)9%

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Definitions:

Job Insecurity

The fear or risk of losing one's job, often due to economic conditions, organizational changes, or industry disruptions.

Safety Motivation

The drive and commitment within individuals or organizations to follow practices and take proactive measures to ensure safety and prevent accidents.

Voluntary Sabbaticals

A period in which an employee takes leave from their job voluntarily, often for personal development, rest, or travel.

Medium-term Solution

A strategy or response designed to address a problem or challenge which is effective for a moderate time frame, typically ranging from a few months to a few years.