Give correct typing answer with explanation and conclusion to all parts Biochemical Corp. requires $540,000 in financing over the next three years. The firm can borrow the funds for three years at 11.80 percent interest per year. The CEO decides to do a forecast and predicts that if she utilizes short-term financing instead, she will pay 8.50 percent interest in the first year, 12.90 percent interest in the second year, and 9.75 percent interest in the third year. Assume interest is paid in full at the end of each year. a. Determine the total interest cost under each plan. Long-tern fixed rate-Interest cost Short-term variable rate-Interest cost b. Which plan is less costly? multiple choice Short-term variable-rate plan Long-term fixed-rate plan
Give correct typing answer with explanation and conclusion to all parts
Biochemical Corp. requires $540,000 in financing over the next three years. The firm can borrow the funds for three years at 11.80 percent interest per year. The CEO decides to do a
a. Determine the total interest cost under each plan.
Long-tern fixed rate-Interest cost
Short-term variable rate-Interest cost
b. Which plan is less costly?
multiple choice
Short-term variable-rate plan
Long-term fixed-rate plan
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