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Linda arranges a discount loan at a 15 percent interest rate, and borrows $200,000 for one year. The stated interest rate is ________ b.



Linda arranges a discount loan at a 15 percent interest rate, and borrows $200,000 for one year.

a. The stated interest rate is ________
b. The effective interest rate is _________
c. What would be the effective rate if the bank required a compensating balance of 20 percent? _____________?


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