Suppose You Purchase Goods on Terms of 2/10, Net 50

question 109

Multiple Choice

Suppose you purchase goods on terms of 2/10, net 50. Taking compounding into account, what annual rate of interest is implied by the cash discount? (Assume a year has 365 days.)

• A) 2%
• B) 20.2%
• C) 10.2%
• D) 18.6%

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Definitions:

Evolutionary Images

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The process by which different kinds of living organisms are thought to have developed and diversified from earlier forms during the history of the earth.