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A promissory note is a written statement agreeing to pay a sumof money either on demand or at a definite future time. When a noteis purchased for its present value at a given interest rate,the note is said to be discounted and the interest rate is calledthe discount rate. Suppose a10,000note due9years from now is sold to a financial institution for6200.What is the nominal discount rate withquarterly compounding?
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