Which of the Following Statements Is True About a Purchase

question 12

Multiple Choice

Which of the following statements is true about a purchase made with the credit terms of 2/10, n/30?

• A)If a company does not make payment within 10 days, the discount will not apply.
• B)If the company makes a payment within 30 days, a 2% discount will apply.
• C)If a company makes a payment between 10 and 30 days, a 2% discount applies.
• D)None of these statements are true.

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Definitions:

Herfindahl-Hirschman Index

A measure used to determine the level of concentration in a market, calculated by summing the squares of the market share percentages of all firms within the industry.

Antitrust Division

A government division responsible for enforcing laws to promote competition and prevent monopolies and other activities that restrain trade.

Moderately Concentrated

Describes an industry structure where a few firms occupy a significant portion of the market share but not to the extent of creating a monopoly or oligopoly.

Pure Monopoly

An industry with a single firm that produces a product for which there are no close substitutes and in which significant barriers to entry prevent other firms from entering the industry to compete for profits.