J11 Q4 – Early settlement discount

Good day Mr Moffat

I used a different approach,

I calculated the effective discount rate as in the lecture
1+R = (1+0,5/99,5)^6 which equals 3%
From here I reached the same conclusion, we should not borrow at 4,5% to earn only 3% from the discount. If the discount rate was higher than the borrowing I would advise to take the discount.

Would this approach be valid?

Thank youin advance.