c.
Bank discount:
[tex]Bank\text{ }Discount=4000\times\frac{9}{100}\times1year[/tex]
As the time is in years you don't need to divide the dime into 360
[tex]Bank\text{ }discount=4000\times0.09\times1=360[/tex]
Bank discount: $360
Proceeds:
[tex]Proceeds=4000-360=3640[/tex]
Proceesds: $3640
Effective rate:
[tex]Effective\text{ }rate=\frac{360}{(3640\times1)}=\frac{360}{3640}=0.0989[/tex]
Effective rate: 0.0989
