1. Prudoe Fuels factors its accounts receivable immediately at a discount of 1.65 percent. The average collection period is 43 days. Assume all accounts are collected in full. What is the effective annual interest rate on this arrangement? Assume a 365-day year.
16.67%
16.09%
18.51%
15.17 %
14.97%
2. Global Network has a market value of $713,000. AG Communications has 46,700 shares of stock outstanding at a price per share of $56. AG is acquiring Global in an exchange for 13,500 shares of AG stock. The merger is expected to create $28,000 of synergy. What will be the postmerger value of the firm?
$3,220,000
$3,356,200
$3,298,000
$3,482,800
$3,218,100