Homework Answers
Borrowings = $350,000
Interest rate = 5%
Interest amount = Borrowings x Interest rate
= 350,000 x 5%
= $17,500
Compensating balance = 10%
= 350,000 x 10%
= $35,000
Net cash available for use = Borrowings - Compensating balance
= 350,000 - 35,000
= $315,000
Effective annual cost of credit = Interest amount/Net cash available for use
= 35,000/315,000
= 5.56%
Correct option is (d)
Please ask if you have any query related to the question. Thank you
Add Answer to:
Houston Enterprises has a line of credit with Capital One that allows Houston to borrow up...
The York Company has arranged a line of credit that allows it to borrow up to...
The York Company has arranged a line of credit that allows it to borrow up to $40 milion at any time. The interest rate is .616 percent per month. Additionally, the company must deposit 5 percent of the amount borrowed in a non-interest bearing account. The bank uses compound interest on its line- of-credit loans. What is the effective annual rate on this line of credit? Multiple Choice 7.65% 7.07% 6.48% 8.94% 8.05%
Yoo, Inc., has arranged a line of credit that allows it to borrow up to $40...
Yoo, Inc., has arranged a line of credit that allows it to borrow up to $40 million at any time. The interest rate is .616 percent per month. Additionally, the company must deposit 5 percent of the amount borrowed in a non-interest bearing account. The bank uses compound interest on its line-of-credit loans. If the company needs $16 million for 5 months, how much will it pay in interest? Multiple Choice $623,636.01 $525,167.17 $583,519.08 $748,363.22 $498,908.81
Yoo, Inc., has arranged a line of credit that allows it to borrow up to $48...
Yoo, Inc., has arranged a line of credit that allows it to borrow up to $48 million at any time. The interest rate is 624 percent per month. Additionally, the company must deposit 6 percent of the amount borrowed in a non-interest bearing account. The bank uses compound interest on its line of credit loans. If the company needs $24 million for 5 months, how much will it pay in interest? Muriple Choice O $750,203 52 $750,2030 O $5,20352 Oo...
you've worked on a line of credit arrangement that allows you to borrow up to 50...
you've worked on a line of credit arrangement that allows you to borrow up to 50 million at a time. the interest rate is .46 percent per month. In addition, 6 percent of the amount that you borrow must be deposited in a non-interest bearing account. Assume that your bank uses compound interest on its lines of credit loans. What is the effective annual interest rate on this lending arrangement?
You've worked out a line of credit arrangement that allows you to borrow up to $35...
You've worked out a line of credit arrangement that allows you to borrow up to $35 million at any time. The interest rate is .52 percent per month. In addition, 2.5 percent of the amount that you borrow must be deposited in a non-interest-bearing account. Assume your bank uses compound interest on its line of credit loans. What is the effective annual interest rate on this lending arrangement?
You have worked on a line of credit arrangement that allows you to borrow up to...
You have worked on a line of credit arrangement that allows you to borrow up to $35 million at any time. The interest rate is .52 percent per month. In addition, 2.5 percent of the amount that you borrow must be deposited in a non interest bearing account. Assume your bank uses compound interest on its line of credit loans. What is the effective annual interest rate on this lending arrangement? Seleccione una: O a. 6.72 percent O b. 6.94...
You’ve worked out a line of credit arrangement that allows you to borrow up to $55...
You’ve worked out a line of credit arrangement that allows you
to borrow up to $55 million at any time. The interest rate is .47
percent per month. In addition, 4 percent of the amount that you
borrow must be deposited in a non-interest-bearing account. Assume
that your bank uses compound interest on its line of credit
loans.
a.
What is the effective annual interest rate on this lending
arrangement? (Do not round intermediate calculations and
enter your answer as...
You've worked out a line of credit arrangement that allows you to borrow up to $45...
You've worked out a line of credit arrangement that allows you to borrow up to $45 million at any time. The interest rate is .49 percent per month. In addition, 6 percent of the amount that you borrow must be deposited in a noninterest-bearing account. Assume that your bank uses compound interest on its line of credit loans. a. What is the effective annual interest rate on this lending arrangement? (Do not round intermediate calculations. Enter your answer as a...
You've worked out a line of credit arrangement that allows you to borrow up to $60...
You've worked out a line of credit arrangement that allows you to borrow up to $60 million at any time. The interest rate is .60 percent per month. In addition, 5 percent of the amount that you borrow must be deposited in a non-interest-bearing account. Assume that your bank uses compound interest on its line of credit loans. a. What is the effective annual interest rate on this lending arrangement? (Do not round intermediate calculations and enter your answer as...
You’ve worked out a line of credit arrangement that allows you to borrow up to $40...
You’ve worked out a line of credit arrangement that allows you to borrow up to $40 million at any time. The interest rate is .52 percent per month. In addition, 6 percent of the amount that you borrow must be deposited in a non-interest-bearing account. Assume that your bank uses compound interest on its line of credit loans. a. What is the effective annual interest rate on this lending arrangement? (Do not round intermediate calculations and enter your answer as...
The York Company has arranged a line of credit that allows it to borrow up to $40 milion at any time. The interest rate is .616 percent per month. Additionally, the company must deposit 5 percent of the amount borrowed in a non-interest bearing account. The bank uses compound interest on its line- of-credit loans. What is the effective annual rate on this line of credit? Multiple Choice 7.65% 7.07% 6.48% 8.94% 8.05%
Yoo, Inc., has arranged a line of credit that allows it to borrow up to $48 million at any time. The interest rate is 624 percent per month. Additionally, the company must deposit 6 percent of the amount borrowed in a non-interest bearing account. The bank uses compound interest on its line of credit loans. If the company needs $24 million for 5 months, how much will it pay in interest? Muriple Choice O $750,203 52 $750,2030 O $5,20352 Oo...
You have worked on a line of credit arrangement that allows you to borrow up to $35 million at any time. The interest rate is .52 percent per month. In addition, 2.5 percent of the amount that you borrow must be deposited in a non interest bearing account. Assume your bank uses compound interest on its line of credit loans. What is the effective annual interest rate on this lending arrangement? Seleccione una: O a. 6.72 percent O b. 6.94...
You’ve worked out a line of credit arrangement that allows you
to borrow up to $55 million at any time. The interest rate is .47
percent per month. In addition, 4 percent of the amount that you
borrow must be deposited in a non-interest-bearing account. Assume
that your bank uses compound interest on its line of credit
loans.
a.
What is the effective annual interest rate on this lending
arrangement? (Do not round intermediate calculations and
enter your answer as...
You've worked out a line of credit arrangement that allows you to borrow up to $45 million at any time. The interest rate is .49 percent per month. In addition, 6 percent of the amount that you borrow must be deposited in a noninterest-bearing account. Assume that your bank uses compound interest on its line of credit loans. a. What is the effective annual interest rate on this lending arrangement? (Do not round intermediate calculations. Enter your answer as a...
You've worked out a line of credit arrangement that allows you to borrow up to $60 million at any time. The interest rate is .60 percent per month. In addition, 5 percent of the amount that you borrow must be deposited in a non-interest-bearing account. Assume that your bank uses compound interest on its line of credit loans. a. What is the effective annual interest rate on this lending arrangement? (Do not round intermediate calculations and enter your answer as...
Most questions answered within 3 hours.
-
If the vapor pressure of carvone is approximately 9.4 torr at 99
°C, approximately how much...
asked 12 minutes ago -
A juice bottling company is carrying out a test at 10%
significance that the mean population...
asked 24 minutes ago -
What is the reflectivity (in percent) needed to keep water at a
temperature near its freezing...
asked 26 minutes ago -
Suppose that the average surface temperature of Earth is 300K.
Assume this is uniform over its...
asked 27 minutes ago -
Draw the condensed structural formula for alkenes and alkynes or
the line-angle structural formula for cycloalkenes...
asked 27 minutes ago -
M. Laing has suggested a new arrangement of the periodic table
(J.Chem.Ed.1989, 66,
746). Answer the following...
asked 48 minutes ago -
Café Michigan's manager, Gary Stark, suspects that demand for
mocha latte coffees depends on the price...
asked 47 minutes ago -
A US merchant purchases wine from a vineyard outside of Paris.
The wine is transported to...
asked 54 minutes ago -
we have (TTN)*
We have to use just one 2-bit counter with 1-bit global
history?
and...
asked 54 minutes ago -
Firms that fail to compete with lower prices and/or better
products will go bankrupt. Does this...
asked 55 minutes ago -
Question 1 Current and Resistance
Part A: A current of -14.5 nanoamperes is how many electrons...
asked 56 minutes ago -
The population standard deviation for the height of college
basketball players is 3.4 inches. If we...
asked 1 hour ago