George Oscar Bluth (GOB) presents a business proposal to his mother, Lucile Bluth. GOB wants to start a magician troupe that performs around Orange County, California. GOB would like a loan of $18,300 to spend on fancy suits. GOB projects that he will be able to pay his mother back $10,000 over the next two years. What is a cost of capital consistent with a self-interested Lucile agreeing to the loan?

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To determine the cost of capital consistent with Lucile Bluth agreeing to the loan we can calculate ... View the full answer