What is the equivalent simple interest rate for this


ABC borrowed $413,310,000 from the bank for one year at an annual rate of 10.5%. Under the terms of the loan, there are no payments during the year -- ABC just repays principal and interest at the end of the year. However, since ABC typically keeps no money in its account with this bank, the loan also requires ABC to maintain a compensating balance of 15%. What is the equivalent simple interest rate for this transaction? Show your answer in decimal form to four places (e.g., 12.34% would be entered as 0.1234)

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Financial Management: What is the equivalent simple interest rate for this
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