The Terms "3/20, Net 60" Mean That

question 106

Multiple Choice

The terms "3/20, net 60" mean that:

• A) in effect, the buyer will pay a 27 percent interest rate if he takes 60 days to pay the invoice.
• B) the buyer must make a 3 percent down payment--with the balance due in 20 to 60 days.
• C) a 3 percent discount off the face value of the invoice is permitted if the bill is paid within 60 days--otherwise, the full face value is due within 20 days.
• D) the invoice is dated March 20 and must be paid within 60 days.
• E) None of the above is a true statement.

---

Definitions:

Teenage Unemployment

Refers to the unemployment rate among teenagers, indicating the proportion of the teenage workforce that is not currently employed but is actively seeking employment.

Bureau of Labor Statistics

An agency of the U.S. government tasked with the collection and analysis of data concerning the labor market, employment conditions, and fluctuations in prices.

Employed

Individuals who are currently working in a job, including both full-time and part-time positions.

Efficiency Wages

Wages set above the market equilibrium to increase worker productivity, reduce turnover, and avoid shirking.