Bradley Mfg

question 327

True/False

Bradley Mfg. changed its credit terms from 2/10 net 30 to 2/10 net 40. In doing so, the firm has lowered the effective annual cost of credit for their customers.

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Definitions:

Interest Rate

The segment of a loan that results in interest fees for the borrower, commonly presented as an annual percent.

Interest Rate

The cost, shown as a percentage of the principal amount, that a lender requires from a borrower to use resources.

Bond

A financial instrument representing a loan made by an investor to a borrower, typically corporate or governmental, which pays back with interest.

Persian Gulf

A marginal sea of the Indian Ocean between the Arabian Peninsula and Iran, known for its strategic location and significant oil reserves.