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A company has a collection period of 40 days and factors all receivables immediately at a discount of 1.8 percent. What is the effective annual

A company has a collection period of 40 days and factors all receivables immediately at a discount of 1.8 percent. What is the effective annual cost of borrowing? Assume 365 days per year.

A) 16.70 percent

B) 17.68 percent

C) 18.03 percent

D) 15.71 percent

E) 16.73 percent

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