Your firm has an average collection period of 26 days. Current practice is to factor all receivables immediately at a discount of 1.6 percent. Assume that default is extremely unlikely and that there are 365 days in a year.

What is the effective cost of borrowing in this case?(Do not round intermediate calculations. Enter your answer as a percentrounded to 2 decimal places, e.g., 32.16.)

Effective cost%