What is the effective cost of borrowing in this case

Reference no: EM13263450

Your firm has an average collection period of 56 days. Current practice is to factor all receivables immediately at a 3 percent discount.

What is the effective cost of borrowing in this case? Assume that default is extremely unlikely. (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places.

Reference no: EM13263450

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