Suppose You Could Borrow $1 Million for One Year at an Interest

question 169

Short Answer

Suppose you could borrow $1 million for one year at an interest rate of 15 percent.You were virtually certain of investing this $1 million for one year and making a profit of $230,000 (from which you would pay the interest you owe).
-Would the deal be acceptable if the interest rate were 12 percent?

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