Answer both questions and explain in detail how you the answer.
1. CASINO. Wyatt Construction borrowed $157.25 million during the construction phase of adding a wing to a casino in Las Vegas. Management signed a 270-day note with a face value of $170 million. Find the discount rate.
2. POOR CREDIT. Cathy Cox has poor credit but she found a bank that will lend her $4200 when she uses some collateral. Still, the bank charges a 12% discount rate. Find (a) the proceeds if the note is for 10 months and (b) the effective interest rate charged by the bank.