. 18. Your company is considering granting credit to a new customer for a one time sale....
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18. Your company is considering granting credit to a new customer for a one time sale. The variable cost per unit is $30; the current price per unit is $60; and the monthly required return (cost of capital) is 2%. What probability of default for the new customer would make the firm break even when granting credit for the one time sale? A) 2% B) 49% C) 51% D) 98% E) 99% 18. Your company is considering granting credit to a new customer for a one time sale. The variable cost per unit is $30; the current price per unit is $60; and the monthly required return (cost of capital) is 2%. What probability of default for the new customer would make the firm break even when granting credit for the one time sale? A) 2% B) 49% C) 51% D) 98% E) 99%
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NPV V 1 pSP1r V Variable cost p probability of default SP ... View the full answer
Related Book For
Managerial Economics Theory Applications and Cases
ISBN: 978-0393912777
8th edition
Authors: Bruce Allen, Keith Weigelt, Neil A. Doherty, Edwin Mansfield
Posted Date:
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