4. A company has a 20 per cent required rate of return. It is currently selling on...
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4. A company has a 20 per cent required rate of return. It is currently selling on terms of "net 20". The credit sales of the company are 100 crore a year. The company's collection period currently is 45 days. If the company offered terms of "2/10, net 30", 60 per cent of its customers will take the discount and the collection period will be reduced to 40 days. Should the terms be changed?
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