Symco corp needs 500000 for 90 days to get through a period


Symco Corp. needs $500,000 for 90 days to get through a period of unexpectedly high oil prices. Symco's line of credit with the bank allows the company to borrow at 6% per year with a compensating balance of 10% of the amount borrowed. Currently, Symco has no money on deposit with the bank. a. Calculate the amount Symco must borrow to meets its needs plus the compensating balance. b. What is the annual percentage rate for this financing? c. If the bank requires discount interest, what is the annual percentage rate for this financing?

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Financial Management: Symco corp needs 500000 for 90 days to get through a period
Reference No:- TGS01414217

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