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determine a borrowing plan that will meet his cash flow needs while minimizing the total interest he pays over the next six months. Show less

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A Soap Processing business plans to borrow money and build up inventory now in anticipation of the h Show more A Soap Processing business plans to borrow money and build up inventory now in anticipation of the holiday season. The following figures are the projected revenues and liabilities the company has for the next six months: Month Revenues Liabilities July 30000 70000 August 30000 50000 Sep 50000 80000 Oct 55000 30000 Nov 70000 40000 Dec 100000 20000 There are two borrowing options available to the company: (1) a six-month loan that is available at the beginning of July and needs to be paid at the end of December with 11% interest (2) a monthly loan that is available at the beginning of each month and needs to be paid at the beginning of the following month with 5% interest. Help the business determine a borrowing plan that will meet his cash flow needs while minimizing the total interest he pays over the next six months. Show less

 
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