HSBC has lend a $100,000 loan to ben company for nine month with annual interest...
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Accounting
HSBC has lend a $100,000 loan to ben company for nine month with annual interest rate at 8%. the compensating balance requirement is 15%. the loan principal and interest must paid in nine month.
1) Assuming the checking checking balance would be zero without the loan, what is the effective interest rate of this loan?
2) What is the effective interest rate if the chequing account of $4,000 through out the loan period without the loan?
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