Martin Inc

question 61

Multiple Choice

Martin Inc.is considering a lockbox system that will increase its check processing cost by $.20 per check.The company estimates an average check size of $900 and expects any funds freed up by the new lockbox system can be invested in an account that earns 4% per year before taxes.What reduction in collection time is necessary for the lockbox to be beneficial to Martin Inc.?

• A) 1.96 days
• B) 2.03 days
• C) 1.73 days
• D) 2.15 days

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Definitions:

Phillips Curve

A concept in economics illustrating the inverse relationship between the rate of unemployment and the rate of inflation in an economy over time.

Unemployment

The condition of being without work while actively searching for employment, often expressed as a percentage of the labor force.

Inflation Rates

An indicator of how quickly the overall price level for goods and services increases, leading to a decline in purchasing power.

Unemployment Rate

The percentage of the labor force that is jobless and actively seeking employment, used as a key indicator of labor market health.