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a. MaazCo needs to increase its working capital by RM4.4 million. The following two financing alternatives are available (assume a 365-day year): Forgo cash discounts
a. MaazCo needs to increase its working capital by RM4.4 million. The following two financing alternatives are available (assume a 365-day year): Forgo cash discounts (granted on a basis of 3/10, net 30) and pay on the final due date or Issue RM4.7 million of six-month commercial paper to net RM4.4 million. [40 Marks] b. Assume that new paper would be issued every six months. Which alternative should MaazCo select? Why? (10 Marks]
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