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:

Universal Motor

An electric motor that can operate on either AC or DC power and is commonly used in portable tools and appliances.

AC

Alternating Current, a type of electrical current where the flow of electric charge periodically reverses direction, commonly used in power supplies.

DC

Direct Current, an electrical current that flows in one direction only, typical in batteries and DC power supplies.

Shaded Pole

A type of single-phase induction motor design that uses a shaded pole for starting torque, commonly found in low-power applications.