Which of the Following Strategies Would Continue to Be Effective

question 78

Multiple Choice

Which of the following strategies would continue to be effective if a cash-strapped firm determines that the effective interest rate charged on trade credit is lower than the bank's interest rate?

• A) Take the discount but pay after the discount period.
• B) Borrow from the bank and take the discount.
• C) Ignore the discount, pay at the end of the period.
• D) Take the discount and hope for longer payment float.

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Definitions:

Ethic Of Ultimate Ends

A moral philosophy that evaluates actions by their consequences or ultimate outcomes, often associated with utilitarianism.

Max Weber

A German sociologist, economist, and political scientist known for his theory on the structure of authority and his insights on the development of capitalism.

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Ethical Theories

are systematic and coherent frameworks used to guide moral decision-making, encompassing principles like utilitarianism, deontology, and virtue ethics.