A Firm Issues Three-Month Commercial Paper with $200,000 Face Value

question 66

Multiple Choice

A firm issues three-month commercial paper with $200,000 face value and receives $192,000. What is the EAR the firm is paying for these funds?

• A) 5.24%
• B) 8.00%
• C) 16.00%
• D) 17.74%

---

Definitions:

Multiple-Channel Distribution

The process of using more than one channel to sell and distribute products to consumers, such as online, retail outlets, and direct sales.

Distribution Channels

The pathways through which a product or service is delivered from the producer to the end consumer.

Market Segmentation

The practice of categorizing a market into distinct subsets of customers with common needs or characteristics.