Question: 4. Computing the cost of a simple interest loan Capel Inc. needs to raise $300,ooo for a nine-month term. Capel's bank has offered to lend

4. Computing the cost of a simple interest loan Capel Inc.

4. Computing the cost of a simple interest loan Capel Inc. needs to raise $300,ooo for a nine-month term. Capel's bank has offered to lend Capel the money at a 20.00% simple interest rate. Capel will receive the $300,000 upon approval of the loan and will pay principal and interest at maturity. back the Calculate the interest payment, the amount of cash received, the annual percentage rate (APR), and the effective annual rate (EAR) of this loan. Value Interest payment Amount of cash received Annual percentage rate (APR) Erfective annual rate (EAR) Suppose the terms of the loan require that Capel maintain a compensating balance equal to 20% of the loan balance. and Capel will have to borrow the compensating balance from the bank calculate the interest payment, the amount of cash received, the annual percentage rate (APR), and the effective annual rate (EAR) of the loan considering the compensating balance requirement. Value Interest payment Amount of cash borrowed Annual percentage rate (APR) Effective annual rate (EAR) Grade It Now Save & Continue

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