Problem 6-9 (Algo) Short-term versus longer-term borrowing [LO6-3] Sauer Food Caripany has decided to buy a new computer system with an expected life of three years. The cost is $340,000. The campany can borrow $340,000 for thee years at 12 percent annial interest or for one year at 10 percent annual interest. Assume interest is paid in full at the end of each year. a. How much would Saver Food Company save in interest over the three-year life of the computer system if the one-year loan is utitred and the ban is rolled over (reborrowed) each year at the same 10 percent rate? Compare this to the 12 percent three-yeat loan. b. What if interest rates on the 10 percent ioan go ip to 15 percent in year 2 and 18 percent in year 3 ? What would be the total interest cost compared to the 12 percent, three-year toan