Matt's Machine Company Has Borrowed $10 Million for Four Months

question 104

Multiple Choice

Matt's Machine Company has borrowed $10 million for four months at 5.5% APR compounded monthly, using inventory stored in a field warehouse as collateral. The warehouse fee is 0.5%, payable at the beginning of the loan. What is Matt's EAR?

• A) 5.5%
• B) 7.24%
• C) 0.58%
• D) 7.01%

---

Definitions:

Mental Disorder

A condition characterized by significant disturbance in an individual's cognition, emotional regulation, or behavior, often associated with distress or impaired functioning.

Hysteria

An older term for a group of presumably psychogenic disorders that included a wide variety of physical and mental symptoms.

General Paresis

A neuropsychiatric disorder affecting the brain that is caused by syphilis infection, leading to cognitive decline and personality changes.

Psychiatric Hospitals

Healthcare facilities specializing in the treatment of serious mental disorders, such as schizophrenia or bipolar disorder.