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2. Weathers Catering Supply, Inc. needs to borrow $150,000 for 6 months. Standard Bank has offered to lend the funds at
Posted: Sun May 29, 2022 6:30 pm
by answerhappygod
- 2 Weathers Catering Supply Inc Needs To Borrow 150 000 For 6 Months Standard Bank Has Offered To Lend The Funds At 1 (26.23 KiB) Viewed 22 times
2. Weathers Catering Supply, Inc. needs to borrow $150,000 for 6 months. Standard Bank has offered to lend the funds at a 9% annual rate subject to a 10% compensating balance. IDLC Finance Co. has offered to lend the funds at a 9% annual rate with discount-loan terms. The principal of both loans would be payable at maturity as a single sum. a. Calculate the effective annual rate of interest on each loan. b. What could Weathers do that would reduce the effective annual rate on the Standard Bank loan?