Answer:
LIBOR would be cheaper i.e. 10.40% as compared with the prime 11%
Explanation:
The effective interest rate is
But before that
The effective interest is
= (9.5% of $5,000) + $45
= $520
Now the effective interest rate is
= 520 ÷ $5,000 × 360 days ÷ 360 days
= 10.40%
And, the prime rate is 11%
So the LIBOR rate would contain the less effective interest cost
The formula for maximum demand deposit creation is excess reserves. multiplied by the monetary multiplier.
A demand deposit is what?
A demand deposit is money deposited into a bank account with funds that can be withdrawn on-demand at any moment. Demand deposit money is often used by the depositor to cover daily expenses. The bank or financial institution may offer a minimal or no interest rate on the deposit for monies in the account.
Demand Payment
A person may only withdraw a set amount every day or a maximum amount equal to their account balance. Money in a checking or savings account would be typical examples of demand deposits. Demand deposits differ from term deposits in this regard. Term depositors must wait a specific amount of time before making any withdrawals.
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The administration of upstream and downstream association's with providers and clients to convey better incentive at less cost than the inventory network all in all.
<span>10,718.63 ± .1%
To find the price of this bond, we need to find the present value of the bond's cash flows. So, the price of the bond is:
P = $145(PVIFA1.25%,48) + $10,000(PVIF1.25%,48)
P = $10,718.63</span>