Analog Computers Needs to Borrow $475,000 from the Midland Bank

question 3

Multiple Choice

Analog Computers needs to borrow $475,000 from the Midland Bank. The bank requires a 15% compensating balance. How much money will Analog need to borrow in order to end up with $475,000 spendable cash?

• A) $546,250
• B) $758,264
• C) $558,824
• D) $71,250

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Definitions:

Satisfaction Guarantee

A promise or assurance given by a company that a customer will be pleased with a product or service, or a refund or replacement will be offered.

Strategic Point

A critical factor or position within a strategic plan that can significantly influence the success or failure of said plan.

Nonmonetary Costs

Costs associated with a purchase that are not financial, such as time spent, effort, and emotional stress.

Opportunity Costs

The value of the best alternative forgone when a decision is made to pursue a particular action or investment.