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Question
SteelCo Production, Inc. is considering the use of a lock-box collection system. SteelCo's average check receipt is $1,350. The company invests excess cash in money-market certificates and receives an average of 3.5% annual interest. The lock-box system will speed up SteelCo's collections by 2.5 days. What is the maximum per check processing cost that SteelCo should be willing to pay for the lock-box system?A) $0.1871
B) $0.2987
C) $0.3236
D) $0.4519
Answer
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