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:

Sleepers

Individuals who, after being exposed to a persuasive message, increase their acceptance of the message over time, even if they initially resisted it.

Defense Mechanisms

Mental mechanisms activated without awareness to defend against anxiety triggered by thoughts or feelings judged as inappropriate.

Individual Differences

Variations among individuals in qualities or attributes, including personality, intelligence, interests, and behaviors.

Children and Adults

A term used to differentiate between the stages of human life, from early development to mature adulthood.