Multiple Choice
Laurentide Resort Company would like to issue $25 million face value of 60-day commercial paper at a cost of 0.65%.In addition, the firm must maintain the $25 million credit line at a cost of 0.1% as a standby fee.What is the effective annual cost of this transaction?
A) 4.02%
B) 4.56%
C) 4.65%
D) 56.57%
Correct Answer:
Verified
Correct Answer:
Verified
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