You can make a one-time sale if you grant a new customer a month to pay. This customer wants to purchase an item with a sales price of RM500 and a variable cost of RM300. You estimate the customers probability of default at 30%. The monthly interest rate is 1%. Should you grant credit to this customer? Why or why not?

Select one:

a. No; because the NPV of the potential sale is -RM53.02

b. Yes; because the NPV of the potential sale is RM33.05

c. Yes; because the NPV of the potential sale is RM46.53

d. No; because the NPV of the potential sale is -RM63.05