What is the simple annual interest cost of the loan

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Blossom, Inc., sells $201,000 of its accounts receivable to factors at a 2 percent discount. The firm's average collection period is 90 days.

Problem 1: What is the dollar cost of the factoring service? (Round answers to nearest whole dollar, e.g. 5,275.) Dollar cost over 90 days?

Problem 2: What is the simple annual interest cost of the loan? (Do not round itermediate calculations. Round answer to 1 decimal place, e.g. 15.1%.)

Problem 3: What is the effective annual interest cost of the loan?

Reference no: EM132930115

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