The Approximate Effective Cost (EC) of Financing the Discount Price

question 59

Multiple Choice

The approximate effective cost (EC) of financing the discount price of trade credit under terms 2/10, net/30 using a 360 day year is:

• A) 25%
• B) 30.1%
• C) 37.2%
• D) 42.5%

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Definitions:

Shearing Forces

Forces that cause parts of a material to slide past each other in opposite directions, often leading to strain or injury in tissues.

Secondary Intention

The wound healing process when the wound is left open and heals by the formation of new tissue rather than by primary closure.

Primary Intention

A healing process in which a wound is closed with sutures, staples, or adhesive, allowing it to heal directly without significant scarring.

Tertiary Intention

A method of wound healing where the wound is intentionally left open and closed later, allowing for edema or infection to resolve.