Idaho Mining,Inc Borrows at Prime Plus 1

question 6

Multiple Choice

Idaho Mining,Inc borrows at prime plus 1.5% on its line of credit.The line requires a 15% compensating balance.If prime rate is 9%,what is the nominal APR of the line of credit?

• A)9.0%
• B)6.0%
• C)10.6%
• D)12.4%

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Definitions:

Motion Aftereffects

The illusion of motion in the opposite direction that occurs after one stops looking at moving stimuli.

Baseline Firing Rate

The normal frequency at which a neuron fires impulses when not being stimulated.

Stroboscopic Motion

An optical illusion where discrete images appear to be moving due to rapid sequential presentation, similar to motion pictures.

Milliseconds

Units of time equal to one thousandth (1/1000) of a second, often used to measure very short time intervals.