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. Howe Industries plans to purchase a new extracting machine for $250,000. The company has been...

. Howe Industries plans to purchase a new extracting machine for $250,000. The company has been quoted a rate of 6.5 percent with discount interest and a compensating balance of 2 percent.

      a. How much will Howe Industries have to borrow?

      b. What is the effective rate on this loan?

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