With Terms of 4/15,net 60,what Is the Implied Interest Rate

question 104

Multiple Choice

With terms of 4/15,net 60,what is the implied interest rate for forgoing a cash discount and paying at the end of the period?

• A) 25.63%
• B) 28.19%
• C) 39.25%
• D) 61.15%

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Definitions:

Continuous Random Variable

A random variable that can take an infinite number of possible values.

Continuous Probability Distribution

A type of probability distribution where the possible outcomes form a continuum and can take on any value within a given range.

Probability Density Function

Probability density function is a function that describes the likelihood of a random variable to take on a given value, primarily used in continuous probability distributions.

Continuous Random Variable

A continuous random variable is a variable that can take an infinite number of values within a given range, representing quantities that can be measured, not just counted.