alculate the APR and rEAR of non-free trade credit associated with credit terms of 3/25, net 85, and 2.5/15, net 60, assuming that customers who do not take the discount a. pay on the last due date. Assume there are 360 days in a year. Do not round intermediate calculations. Round your answers to two decimal places. Credit terms of APR TEAR 3/25, net 85 APR TEAR b. delay payment until 15 days after the last due date. Assume there are 360 days in a year. Do not round intermediate calculations. Round your answers to two decimal places. % % 3/25, net 85 2.5/15, net 60 Credit terms of % % 2.5/15, net 60 % % % %

alculate the APR and rEAR of non-free trade credit associated with credit terms of 3/25, net 85, and 2.5/15, net 60, assuming that customers who do not take the discount a. pay on the last due date. Assume there are 360 days in a year. Do not round intermediate calculations. Round your answers to two decimal places. Credit terms of APR TEAR 3/25, net 85 APR TEAR b. delay payment until 15 days after the last due date. Assume there are 360 days in a year. Do not round intermediate calculations. Round your answers to two decimal places. % % 3/25, net 85 2.5/15, net 60 Credit terms of % % 2.5/15, net 60 % % % %

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Concept explainers

Trade Credit

Answer- a- Before Shipping of goods

Question

Calculate the APR and rEAR of non-free trade credit associated
with credit terms of 3/25, net 85, and 2.5/15, net 60, assuming
that customers who do not take the discount
a. pay on the last due date. Assume there are 360 days in a
year. Do not round intermediate calculations. Round your
answers to two decimal places.
Credit terms of
APR
TEAR
3/25, net 85
APR
TEAR
b. delay payment until 15 days after the last due date. Assume
there are 360 days in a year. Do not round intermediate
calculations. Round your answers to two decimal places.
%
%
3/25, net 85
2.5/15, net 60
Credit terms of
%
%
%
%
2.5/15, net 60
%
%

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