Simple Simon's Bakery purchases supplies on terms of 1.9/10, net 30. If Simple Simon's chooses to take the discount offered, it must obtain a bank loan to meet its short-term financing needs. A local bank has quoted Simple Simon's owner an interest rate of 10.4 %on borrowed funds. Should Simple Simon's enter the loan agreement with the bank and begin taking the discount? (Hint: Use a 365-day year.)

The cost of foregoing the discount is %?