What Is the Meaning of the Term 2/10 Net 30

question 10

Multiple Choice

What is the meaning of the term 2/10 net 30?

• A) If the invoice is paid within 10 days, a 2% discount can be taken. If the invoice is paid between 11 and 29 days, a 1% discount can be taken. After 30 days, the full invoice is due.
• B) If the invoice is paid within 2 days, a 10% discount can be taken; otherwise the full invoice is due in 30 days.
• C) If the invoice is paid within 2 days, a 10% discount can be taken; otherwise a 2% discount can be taken if the invoice is paid in 30 days.
• D) If the invoice is paid within 10 days, a 2% discount can be taken; otherwise the full invoice is due in 30 days.

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Definitions:

Market Failures

Situations where the allocation of goods and services by a free market is not efficient, often leading to a net social welfare loss.

Private Goods

Goods that are excludable and rivalrous in consumption, meaning access can be limited and consumption by one individual prevents others from consuming the same good.

Public Goods

Goods that are non-excludable and non-rival in consumption, meaning they are available for everyone to consume regardless of who pays and one person's consumption does not reduce availability to others.

Reward Power

The ability of an individual to influence the behavior of others by offering or withholding incentives.