If Marjorie Wilcox Borrows $200 for One Year with an APR

question 87

Multiple Choice

If Marjorie Wilcox borrows $200 for one year with an APR of 12% and an annual service fee of $10,what is her total cost of credit?

• A)$10
• B)$12
• C)$24
• D)$34
• E)$42

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Definitions:

Net Cash Flow

The overall flow of currency into and out of an enterprise, critically influencing its liquid assets.

Borrow

Borrow refers to the act of receiving something with the intention to return it, often with interest in the case of financial borrowing.

Accounts Receivable Period

The average number of days that it takes for a company to receive payments from its customers for invoices issued.

Sales

The total amount of a company's revenues earned from selling its goods or services over a specific period.