Use the Following Information to Answer the Question(s)below

question 23

Multiple Choice

Use the following information to answer the question(s) below.
Taggart Transcontinental needs a $100,000 loan for the next 30 days.Taggart has three alternatives available:
Alternative #1: Forgo the discount on its trade credit agreement that offers terms of 2/5 net 35.
Alternative #2: Borrow the money from Bank A,which has offered to lend the firm $100,000 for one month at
an APR of 9%.The bank will require a (no-interest) compensating balance of 10% of the face-value of the loan and will charge a $200 loan origination fee,which means that Taggart must borrow even more than the $100,000 they need.
Alternative #3: Borrow the money from Bank B,which has offered to lend the firm $100,000 for one month at an APR of 12%.The loan has a 1% origination fee.
-Which alternative should Taggart choose?

• A)Alternative #1 since it has the lowest EAR
• B)Alternative #2 since it has the lowest EAR
• C)Alternative #3 since it has the lowest EAR
• D)Alternative #2 since it has the highest actual rate

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Definitions:

Calvin-Benson Cycle

A series of biochemical redox reactions taking place in the chloroplasts of photosynthetic organisms, crucial for converting carbon dioxide into glucose.

Light-Dependent Reactions

The first phase of photosynthesis where light energy is absorbed by chlorophyll and converted into chemical energy for ATP and NADPH production.

ATP Synthase

An enzyme located in the membrane of mitochondria that helps in the synthesis of ATP (adenosine triphosphate) from ADP and phosphate during cellular respiration.

Hydrogen Ions

Positively charged ions of hydrogen, crucial in determining the acidity or alkalinity of solutions.