What is the effective annual interest rate

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Question: First Bank offers KNJ Co. a $100,000 line of credit at an annual rate of interest of 9.5 percent. The loan agreement also requires a 4 percent compensating balance on any funds used. What is the effective annual interest rate if the firm needs $60,000 for the entire year to fund its operations? The response must be typed, single spaced, must be in times new roman font (size 12) and must follow the APA format.

Reference no: EM131975915

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