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The Rasputin Brewery is considering using a public warehouse loan as part of its​ short-term financing....

The Rasputin Brewery is considering using a public warehouse loan as part of its​ short-term financing. The firm will require a loan of $540,000. Interest on the loan will be 9.8% ​(APR, annual​ compounding), to be paid at the end of the year. The warehouse charges 1.05% of the face value of the​ loan, payable at the beginning of the year. What is the effective annual rate​ (EAR) of this warehousing​ arrangement?

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Home nert Page Layout Formulas Data Review View dd-Ins s Cut aCopy E AutoSum Calibri ー E ゴWrap Text General в 1 프 . Ej-., Δ. : rーー 逻锂函Merge & Center. $, % , 弼,8 C Paste Conditional Format CeInsert Delete Format Formatting as Table Styles2 Clear Sort &Find & Format Painter Clipboard Font Alignment Number Styles Cells Edting E133 ED rasputin brewery EB EC ЕЕ EF EG EH El El EK EL EM EN EO EP 23 24 25 26 27 28 29 30 31 32 interest on loan warehouse charges540000 1.05%- total charges/payment 540000 x 9.8% 52920.00 5670.00 58590.00 As warehouse charges are payable in beginning of the year, it will be reduced from loan amount so loan avalilable will be 540000-5670534330 effective annual rate- 58590/534330 - 10.97% 34 35 36 37 38 39 40 41 LINE OF CREDIT miler Sheet3 BANKER ACCEPTANC0 06:43 06-01-2019

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