Kara2022-03-08 14:56:05

Fancy Nancy has to borrow funds at 10 percent to purchase a necklace. She has a contract to sell the necklace for $70,000. Payment is to be received in two years’ time. The necklace cost $60,000 today and could be sold for this amount. Nancy likes this arrangement as she does not have to give up the necklace for two years and by then fashions will possibly have changed. What is the borrowing rate at which she would break even?