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Lewis Companies sells 2,600 units a month for cash at a price of $299 a unit and a variable cost of $187 a unit. The
Lewis Companies sells 2,600 units a month for cash at a price of $299 a unit and a variable cost of $187 a unit. The firm estimates it can increase its sales by 200 units a month if it switches to a net 30 credit policy while keeping its price and costs at their current levels. If the monthly cost of capital is .85 percent, what is the NPV of switching?
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