Question

​(Related to Checkpoint​ 18.2) ​(Estimating the cost of bank​ credit) Paymaster Enterprises has arranged to finance its seasonal​ working-capital needs with a​ short-term bank loan. The loan will carry a rate of

1414

percent per annum with interest paid in advance​ (discounted). In​ addition, Paymaster must maintain a minimum demand deposit with the bank of

88

percent of the loan balance throughout the term of the loan. If Paymaster plans to borrow

​$120 comma 000120,000

for a period of

33

​months, what is the annualized cost of the bank​ loan?

The annualized cost of the bank loan is

nothing​%.

​(Round to two decimal​ places.)

Answer 1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE