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Assume That Biggie-Mart,whose Credit Card Billings Total $120 Billion Per

question 32

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Assume that Biggie-Mart,whose credit card billings total $120 billion per year,were to implement a lockbox arrangement that would speed up the collection of its credit card billings by 2 full days.If Biggie-Mart could earn 3.5% on its marketable securities,how much would the firm earn per year from such a lockbox arrangement? Assume a 365-day year.


Definitions:

Authority

The authority to command, decide, and ensure compliance.

Custom

A traditional and widely accepted way of behaving or doing something specific to a particular society, place, or time.

Apparent Authority

The appearance or assumption of authority given to an agent, employee, or representative by the actions or statements of the principal, leading third parties to believe the agent has such authority.

Actual Authority

The express and implied powers given to an agent by a principal, allowing the agent to act on behalf of the principal.

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