Different loan rates. Winthrop Enterprises is a holding company (a firm that owns all or most of some other companies' outstanding stock). Winthrop has four subsidiaries. Each subsidiary borrows capital from the parent company for projects. Ervin Company is successful with its projects 93 % of the time, Morten Company 76 % of the time, Richmond Company 95 % of the time, and Garfield Company 82 % of the time. What loan rates should Winthrop Enterprises charge each subsidiary for loans? What loan rate should Winthrop Enterprises charge Ervin Company for loans?
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