Question: Kenneth's Arrows and Bows borrows $10,000 for one year at 12 percent interest. What is the effective rate of interest if the loan is discounted?

Kenneth's Arrows and Bows borrows $10,000 for one year at 12 percent interest. What is the effective rate of interest if the loan is discounted?
A. Less than 12.5 percent
B. More than 12.5 percent, but less than 13.5 percent
C. More than 13.5 percent, but less than 14.5 percent
D. More than 14.5 percent

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