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Gazapizm Corporation is a manufacturing company and has estimated that they need $2,400,000 to put a new pump into operation. The company can finance the

  1. Gazapizm Corporation is a manufacturing company and has estimated that they need $2,400,000 to put a new pump into operation. The company can finance the the new pump by delaying payment to its suppliers. Presently the company has a supplier which sells on credit with credit terms of 2/15, net 45 days. If the firm does not take the discount and pays on the 50th day, then what is the effective annual cost? (Assume a 365-day year.)

    20.53%

    23.45%

    18.93%

    16.71%

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