Kenneth's Arrows and Bows borrow $10,000 for one year at 7 percent interest. What is the effective rate of interest if the loan is discounted? (Use 360 days in a year.)
Less than 6.6 percent
More than 8.6 percent
More than 7.7 percent, but less than 8.6 percent
More than 6.6 percent, but less than 7.7 percent