BRCC is evaluating an option for funding its working capital during the next year. The company plans to issue 180-day commercial paper which has an annual interest rate of 8.8% and requires BRCC to pay a transaction fee equal to 0.25%. If BRCC actually needs $225,000 to finance working capital during the next year, how much must BRCC borrow so that it has $

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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BRCC is evaluating an option for funding its working capital during the next year. The company plans to issue 180-day commercial paper which has an annual interest rate of 8.8% and requires BRCC to pay a transaction fee equal to 0.25%. If BRCC actually needs $225,000 to finance working capital during the next year, how much must BRCC borrow so that it has $225,000 avaliable to pay bills?

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