Ignoring Defaults, What Is the Approximate Effective Cost of Factoring

question 83

Multiple Choice

Ignoring defaults, what is the approximate effective cost of factoring if receivables are sold at a 2% discount and the average collection period is 1 month?

• A) 19.40%
• B) 24.00%
• C) 26.53%
• D)27.43%

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Definitions:

Electroconvulsive Therapy (ECT)

A therapeutic procedure where electric shocks are applied to induce seizures in individuals as a way to mitigate mental health issues.

Treatment

The management and care of a patient or the combating of disease or disorder.

Depression

Depression is a common mental disorder characterized by persistent sadness, loss of interest or pleasure, feelings of guilt or low self-worth, disturbed sleep or appetite, low energy, and poor concentration.

Biological Model

An approach in psychology and medicine that focuses on biological factors as the main cause of mental disorders.