Cash Discount Terms of 2/10, Net 60 on an Invoice

question 139

Multiple Choice

Cash discount terms of 2/10, net 60 on an invoice would-in effect-amount to borrowing at an annual interest rate of about ________ percent if the buyer did not pay the invoice for 60 days.

• A) 22
• B) 72
• C) 14
• D) 18
• E) 36

Understand and perform calculations for the determination of missing financial values using given interest rates and time periods.

Calculate simple and compound interest for various financial situations and investments.

Apply the concept of time value of money in situations involving multiple payments or investments over time.

Analyze and solve problems involving loan repayment schedules, including determining the size of equal payments.

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Definitions:

Cervical

Pertaining to the neck or the cervix, the lower, narrow part of the uterus that opens into the vagina.

Cerebrospinal Fluid

A clear, colorless body fluid found in the brain and spinal cord, acting as a cushion and providing basic mechanical and immunological protection to the brain.

Choroid Plexus

A network of cells in the ventricles of the brain that produce cerebrospinal fluid.

Ventricle

A chamber of the heart or brain that receives or pumps out blood or cerebrospinal fluid, respectively.