Your firm has an average collection period of 21 days


Your firm has an average collection period of 21 days. Current practice is to factor all receivables immediately at a discount of 1.1 percent.

What is the effective cost of borrowing in this case? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

 

  Effective cost   %  

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Financial Management: Your firm has an average collection period of 21 days
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