ANSWER:-
Additional credit = 11,900000 * 40 /365
=$1,304,109.58
Nominal cost =(discount rate) / (1-discount rate )) *
(365 / (credit period - discount period))
=(0.02/(1-0.02)) * (365 / (50-10))
=18.62%
Effective cost = (1+(discount rate / (1- discount
rate)))^ (365 / (credit period - discount period)) -1
=(1+2/98)^(365/40) -1
=20.24%
Effective rate of bank loan
=(1+0.082/12)^(12)-1
=8.52%
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