PDQ Enterprise can borrow from its bank using a one-year (a) Simple interest loan with a 12
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PDQ Enterprise can borrow from its bank using a one-year
(a) Simple interest loan with a 12 percent quoted rate and no compensating balance
(b) A discount interest loan with a quoted rate equal to 10 percent that requires a 15 percent compensating balance. What is the EAR of the lower-cost loan? PDQ normally tries to keep its checking account balance close to $0.
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