Jim's Electrical Is Offered a $400,000 Line of Credit for Six

question 83

Multiple Choice

Jim's Electrical is offered a $400,000 line of credit for six months at an APR of 9%.The bank requires that the firm keep an amount equal to 5% of the loan principal in a non-interest-earning account with the bank as long as the loan remains outstanding.What is the actual six-month interest rate paid,expressed as an EAR?

• A)3.2%
• B)5.0%
• C)9.70%
• D)24.3%
• E)27.6%

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Definitions:

Connection

Connection pertains to the relationship or link between individuals, groups, or systems that allows for communication, interaction, or functional integration.

Company's Website

An online platform owned and operated by a business, designed to provide information about the company, its products, and services.

Commerce Element

Fundamental aspects or components involved in the buying and selling of goods and services.

7Cs

An extension of the marketing mix that includes Customer, Cost, Convenience, Communication, Caring, Confirmation, and Culture considerations.