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Sauer Food Company has decided to buy a new computer system with an expected life of three years. The cost is $1.5M. The company can
Sauer Food Company has decided to buy a new computer system with an expected life of three years. The cost is $1.5M. The company can borrow $1.5M for three years at 10 percent annual interest or for one year at 8 percent annual interest.
What would be the total interest cost compared to the 10 percent, three-year loan?
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