Question: a. What interest rate would make it worthwhile to incur a compensating balance of $21,000 in order to get a 1 percent lower interest rate

What interest rate would make it worthwhile to incur a compensating balance of $21,000 in order to get a 1 percent lower interest rate on a 1 year, pure discount loan of $280,000? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your final answer to 2 decimal places.)

(THe answer is not 14.33%)

Interest rate

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