Question: JTM is considering purchasing a 3D printer. The price is $945,000. The dealer is offering a payment plan in which JTM pays 20% down and

JTM is considering purchasing a 3D printer. The price is $945,000. The dealer is offering a payment plan in which JTM pays 20% down and finances the rest over 24 months at $34,450/month. What is the implicit financing rate? If JTM's WACC is 7%, should it accept the financing offer?

A B D E 2 Cash price 945,000 0.0% 3 Down payment 189,000 4 Monthly payment 34.450 5 Cash Flows 6 Cash price minus down payment 7 Mo. 1 8 Mo. 2 Mo. 3 10 Mo. 4 11 Mo. 5 12 Mo. 6 13 Mo. 7 14 Mo. 8 15 Mo. 9 16 Mo. 10 17 Mo. 11 18 Mo. 12 19 Mo. 13 20 Mo. 14 21 Mo. 15 22 Mo. 16 23 Mo. 17 24 Mo. 18 25 Mo. 19 26 Mo. 20 27 Mo. 21 28 Mo. 22 29 Mo. 23 30 Mo. 24

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