a. If a firm buys under terms of 3/15, net 45, but actually pays on the 20th

Question:

a. If a firm buys under terms of 3/15, net 45, but actually pays on the 20th day and still takes the discount, what is the APR of its nonfree trade credit?
b. Does the firm receive more or less credit than it would if it paid within 15 days?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Principles of Finance

ISBN: 978-1285429649

6th edition

Authors: Scott Besley, Eugene F. Brigham

Question Posted: