Sue Sharpe, manager of Oaks Mall Jewelry, wants to sell on credit, giving customers three months in

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Sue Sharpe, manager of Oaks Mall Jewelry, wants to sell on credit, giving customers three months in which to pay. However, Sue will have to borrow from her bank to carry the accounts payable. The bank will charge a simple 15 percent interest rate, but with monthly compounding. Sue wants to quote a simple rate to her customers that will exactly cover her financing costs. What simple annual rate should she quote to her credit customers?

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Principles of Finance

ISBN: 978-1285429649

6th edition

Authors: Scott Besley, Eugene F. Brigham

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