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Determine what is the effective interest rate on the loan

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Question 1: The Kellogg Bank requires borrowers to keep an 9 percent compensating balance. Gorman Jewels borrows $300,000 at a 7.0 percent stated APR. What is the effective interest rate on the loan? (Round intermediate calculations to 4 decimal places, e.g. 1.2541 and final answer to 2 decimal places, e.g. 12.25%.)

Reference no: EM132601138

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