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A firm does not currently allow customers to purchase on credit. It sells a toaster oven for $35(P) which has a variable cost per unit

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A firm does not currently allow customers to purchase on credit. It sells a toaster oven for $35(P) which has a variable cost per unit of $15 (v). The firm currently sells 100 units (Q) each month. The firm is considering allowing purchases on credit for up to 30 days with no additional fees or interest. It projects that 120 units (Q') will be sold if credit is extended for 30 days. The required return for the firm is 2.5%. What is the monthly cost of switching to sales on credit with 30 days to pay in full? $3,800 $4,500 $2,400 $3,500

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