In: Finance
Carmen’s Beauty Salon has estimated monthly financing
requirements for the next six months as follows:
January | $ | 9,300 | April | $ | 9,300 |
February | 3,300 | May | 10,300 | ||
March | 4,300 | June | 5,300 | ||
Short-term financing will be utilized for the next six months.
Projected annual interest rates are:
January | 7 | % | April | 14 | % |
February | 8 | May | 12 | ||
March | 11 | June | 12 | ||
What long-term interest rate would represent a break-even point
between using short-term financing and long-term financing?
(Round your monthly interest rate to 2 decimal places when
expressed as a percent. Round your interest payments to the nearest
whole cent. Input your answer as a percent rounded to 2 decimal
places.)
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