Saucer Food Company has decided to buy a new computer system with an expected life of 3 years. The cost is $150000. The company can borrow $150,000 for three years at 10 percent annual interest or for one year at 8 percent annual interest. 
How much would saucer food company save in interest over the 3 year life of the computer system if the one year loan is utilized and the loan is rolled over (re borrowed) each year at the same 8 percent rate? Compare this to the 10 percent three year loan. What if the interest rates on the 8 percent loan go up to 13 percent in year 2 and 18 percent in year 3? What would be the total interest cost compared to the 10 percent, three year loan?