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NEW QUESTION: 1
A. Option B
B. Option C
C. Option D
D. Option A
Answer: A
Explanation:
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NEW QUESTION: 2
If a firm borrows $500,000 at 10 percent and is required to maintain $50,000 as a minimum compensating
balance at the bank, what is the effective interest rate on the loan?
A. 11.1 percent.
B. 12.2 percent.
C. 9.1 percent.
D. 11.0 percent.
Answer: A
Explanation:
Choice "a" is correct. 11.1% effective interest rate on loan.
This question pertains to the computation of the effective rate of interest on a $500,000 note with a 10%
stated rate that requires a $50,000 compensating balance. The answer computes the effective rate at
1 1.1% by taking the ratio of the amount paid $50,000 to the funds available $450,000 ($500,000 $50,000).
Why would the $50,000 in interest payments not also be deducted in arriving at the effective rate? The
simple answer is that the note is not discounted by the interest. It is only subject to the compensating
balance. The borrower receives $500,000 in proceeds but must hold out $50,000 and pay back $550,000,
principal + interest, to the lender. At the conclusion of the loan, the compensating balance requirement is
removed.
NEW QUESTION: 3
Click the Exhibit.
The router with the configuration shown in the exhibit has two interfaces, both of which are operational and can pass traffic. These interfaces are connected to two different routers, both of which are configured for OSPF area 0.0.0.1. The router has received LSAs and can now send traffic into the backbone area.
Which two statements are correct? (Choose two.)
A. The router is an ABR.
B. The router has only a single OSPF adjacency.
C. The router has two OSPF adjacencies.
D. The router is an ASBR.
Answer: B,D
NEW QUESTION: 4
Refer to the exhibit.
Which application is illustrated in the exhibit?
A. Interview Handler
B. Call Handler
C. Audiotext Application Manager
D. Job Handler
E. Audio Text Manager
Answer: E
