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Bill is a new customer has asked to establish credit with your company. He would like to buy some equipment at a cost of $10,700.

Bill is a new customer has asked to establish credit with your company. He would like to buy some equipment at a cost of $10,700. Your variable cost for that equipment is $7,700 and your monthly interest rate is 0.8 percent. You believe that Bill will be a one-time customer if you grant him 30 days credit. As long as Bill's probability of default is less than _____, you should grant him credit.

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