Your Company Has Been Offered Credit Terms of 4/30, Net

question 32

Multiple Choice

Your company has been offered credit terms of 4/30, net 90 days. What will the nominal annual cost of trade credit be if you pay 100 days after the purchase? (Assume a 365-day year.)

• A) 20.64%
• B) 21.73%
• C) 22.81%
• D) 23.95%

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Definitions:

Intensity

The magnitude or strength of a phenomenon, such as sound, light, or physical force, often described in terms of levels or degrees.

Pain

An unpleasant sensory and emotional experience associated with actual or potential tissue damage, or described in terms of such damage.

Acute Pain

A type of pain that is sharp and severe but lasts for a relatively short period, often signaling tissue damage or an injury.

Fibromyalgia

A chronic disorder characterized by widespread musculoskeletal pain, fatigue, and tenderness in localized areas.