Ivanhoe, Inc., has just set up a formal line of credit of $10 million with...
90.2K
Verified Solution
Link Copied!
Question
Finance
Ivanhoe, Inc., has just set up a formal line of credit of $10 million with First Community Commercial Bank. The line of credit is good for up to five years. The bank will charge Ivanhoe an interest rate of 7.00 percent on any amount borrowed, and the firm will pay an annual fee of 60 basis points on the unused balance. The firm borrowed $8.0 million on the first day the credit line became available. What is the effective interest rate on this line of credit? (Round answer to 2 decimal places, e.g. 12.25%.)
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
