What Effective Annual Rate of Interest Is Being Charged to a Customer

question 54

Multiple Choice

What effective annual rate of interest is being charged to a customer who is granted credit terms of 3/15,net 45 when the customer foregoes the discount and pays on the last date prior to being delinquent?

• A) 44.86%
• B) 48.29%
• C) 37.67%
• D) 41.84%

---

Definitions:

Articular Cartilage

A sleek, pale material enveloping bone tips where they meet to create joints, lessening friction and mitigating shock.

Fibrous Capsule

A type of dense connective tissue that encloses organs and joints, providing support and protection.

Lyme Disease

A bacterial infection transmitted by ticks, characterized by a skin rash, fever, and fatigue, potentially leading to chronic symptoms.

Autoimmune Disease

An autoimmune disease occurs when the immune system mistakenly attacks the body's own tissues, leading to inflammation, damage, and dysfunction of affected organs.