A Supplier Grants Your Firm Credit Terms of 2/10, Net

question 56

Multiple Choice

A supplier grants your firm credit terms of 2/10, net 40. What is the effective annual rate of the discount if the firm purchases $4,600 worth of merchandise?

• A)27.24 percent
• B)27.86 percent
• C)28.80 percent
• D)29.03 percent
• E)29.27 percent

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Definitions:

Side-Tracker

A factor or behavior that diverts or distracts focus from the main issue or task at hand.

Negative Behaviors

Actions or conduct that are detrimental to oneself or others.

Facilitator

A person who makes an action or process easy or easier, often guiding groups in discussions or activities.

Inhibits Creativity

Refers to factors or conditions that negatively affect or constrain one's ability to generate innovative ideas or solutions.