Your firm has an average collection period of $47$ days. Current

practice is to factor all receivables immediately at a discount

rate of $3\mathrm{.}5$ percent. Assume that default is extremely unlikely.

What is the effective cost of borrowing?$28\mathrm{.}79$ percent$36\mathrm{.}20$ percent$37\mathrm{.}78$ percent$40\mathrm{.}97$ percent$31\mathrm{.}87$ percent