Check my were 7 Problem 6-9 Short-term versus longer-term borrowing [LO6-3) ots Sauer Food Company has decided to buy a new computer system with an expected We of three years. The cost is $310.000 The company can borrow $310,000 for three years at 13 percent annual interest or for one year at 11 percent annual terest Astume Interest is paid in full at the end of each year. .. How much would Sauer Food Company save in interest over the three year ide of the computer system of the one year ons utilized and the loan is rolled over treborrowed) each year at the same 1 percent rate Compare this to the percent three year loan Book Defence Interest 11 percent loan 13 percent loan Interest savings b. What if interest rates on the 11 percent loan go up to 16 percent in year 2 and 19 percent in year 3? What would be the total interest cost compared to the 13 percent three year loan? Interest UGOTOWAWILOR 10 points 11 percent loan 13 percent loan Interest savings eBook References b. What if Interest rates on the 11 percent loan go up to 15 percent in year 2 and 19 percent an year 3? What would be the total interest cost compared to the 13 percent, three-year loan? Interest Fixed-rate 13% loan Variable-rate loan Additional Interest cost EN SPM