If You Buy a Factory for $250,000 and the Terms

question 25

Multiple Choice

If you buy a factory for $250,000 and the terms are 20% down,the balance to be paid off over 30 years at a 12 percent rate of interest on the unpaid balance,what are the 30 equal annual payments? (Round to the nearest whole dollar)

• A) $20,593
• B) $31,036
• C) $24,829
• D) $50,212
• E) $6,667

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Definitions:

Consignment

An arrangement where goods are left with a third party to sell, but the ownership remains with the supplier until the goods are sold.

General Merchandise

A category of products that includes a wide variety of items, typically found in a department store or retail outlet, not limited to any specific category.

Channel Functions

Activities involved in moving goods from producers to consumers, including distribution, transportation, and retailing.

Rack Jobbers

Merchandisers who lease space within retail stores to display and sell their own products, typically involved in the distribution of books, music, or electronics.