Factoring. A firm sells its accounts receivables to a factor at a 1.5 percent discount. The average
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Factoring. A firm sells its accounts receivables to a factor at a 1.5 percent discount. The average collection period is 1 month. What is the implicit effective annual interest rate on the factoring arrangement? Suppose the average collection period is 1.5 months. How does this affect the implicit effective annual interest rate?
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Related Book For 
Study Guide To Accompany Fundamentals Of Corporate Finance
ISBN: 9780073012421
5th Edition
Authors: Richard Brealey, Stewart Myers, Alan Marcus
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