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Neveready Flashlights Inc. needs $302,000 to take a cash discount of 2/19, net 71. A banker will loan the money for 52 days at an interest cost of $11,800. a. What is the effective rate on the bank loan
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Neveready Flashlights Inc. needs $302,000 to take a cash discount of 2/19, net 71. A banker will loan the money for 52 days at an interest cost of $11,800. a. What is the effective rate on the bank loan

User Vaha
by
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1 Answer

4 votes

Answer:

The effective rate on the bank loan is 27%

Step-by-step explanation:

The effective rate of Interest

= ($11,800/$302,000)*(360Days/52days)

= 0.039*6.92

=27%

User Yellow And Red
by
4.7k points
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