Your firm has an average collection period of 38 days. Current practice is to factor all receivables
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Your firm has an average collection period of 38 days. Current practice is to factor all receivables immediately at a discount of 1.5 percent. What is the effective cost of borrowing in this case? Assume that default is extremely unlikely.
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If we factor immediately we receive cash on an aver...View the full answer
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Related Book For 
Corporate Finance Core Principles and Applications
ISBN: 978-1259289903
5th edition
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan
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