Zoble Department Store credit sales of Br. 1,880,000. Average collection period is of two months. Average selling price per unit is Br. 10 and the average cost per unit is Br. 8. The firm can reduce...

Zoble Department Store credit sales of Br. 1,880,000. Average collection period is of two months. Average selling price per unit is Br. 10 and the average cost per unit is Br. 8. The firm can reduce the average collection period by one month giving 2% cash discount, as 50% of the customers will avail of this cash. The required return for the firm is 20%. Should Zoble Department Store liberalize the credit policy? Explain.