Conways Roofing Services Is Offered a $1 Million Line of Credit

question 19

Multiple Choice

Conways Roofing Services is offered a $1 million line of credit for three months at an APR of 8%. The bank requires that the firm keep an amount equal to 12% of the loan principal in a non-interest-earning account with the bank as long as the loan remains outstanding. What is the actual three-month interest rate paid, expressed as an EAR?

• A) 9.41%
• B) 24.40%
• C) 60.30%
• D) 80.40%

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Definitions:

Scientific Beneficence

A principle in research ethics focusing on contributing to the well-being of participants and society.

Informed Consent

A participant’s informed (knowledge of the scope of the research and potential harm and benefits of participating), rational, and voluntary agreement to participate in a study.

Traumatic Brain Injury

Physical damage to the brain caused by a bump, blow, or jolt to the head, or penetrating head injury, leading to temporary or permanent impairment.

Adult's Capacity

The ability or capabilities of an adult individual, often referring to mental, physical, emotional, or social aptitudes.