Bank of America borrowed $80,000,000 at 5% interest for 180 days from a Japanese investment house. At the same time, the bank made the following three loans, each for the exact same 180-day period:
A 7% simple interest note for$38,000,000 to a Canadian firm that extracts oil from Canadian tar sands;
An 8.2% simple discount note for $27,500,000 to a European contractor building a factory in South Africa; and
An 8% simple discount note for$14,500,000 to a Louisiana company building minesweepers in New Orleans for the British government.
Find the difference between interest received and interest paid by the bank on these funds.
a. $1,364,000
b. $1,470,000
c. $1,542,000
d. $1,623,000
