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MernoMate, a manufacturer of phone answering machines, is analyzing the credit terms of three of its suppliers, shown below. Its cost of borrowing from its

MernoMate, a manufacturer of phone answering machines, is analyzing the credit terms of

three of its

suppliers, shown below. Its cost of borrowing from its bank is 14%.

Supplier Credit Terms

1 1/10 net 45

2 2/15 net 30

3 2/10 net 35

From which, if any, of the suppliers should the cash discount be taken, and why?

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