The Best Measure of the True Cost of Credit Is

question 104

Multiple Choice

The best measure of the true cost of credit is the

• A)monthly payment.
• B)finance charge.
• C)annual percentage rate of interest.
• D)late fee.

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Definitions:

Total Liabilities

The combined amount of all financial obligations a company owes to outside parties, including loans, accounts payable, mortgages, and other debts.

Total Assets

The sum of all resources owned by an entity that have economic value and can be measured and expressed in monetary terms.

Average Sale Period

The average amount of time it takes for a business to sell its inventory or a specific product.

Net Profit Margin Percentage

A financial ratio indicating the percentage of revenue that remains as net income after all expenses, interest, and taxes have been deducted.