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You are trying to decide between two mobile phone carriers. Carrier A requires you to pay $200 for the phone and then monthly charges of $60 for 24 months.

Carrier B wants you to pay $100 for the phone and then monthly charges of $70 for 12 months. Assume you will keep replacing the phone after your contract expires.

Your cost of capital is 3%. Based on cost alone, which carrier should you choose?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92870019

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