Question
A firm offers terms of 2/15, net 45. (Enter your answers as directed, but do not round intermediate calculations.) Requirement 1: What effective annual interest
A firm offers terms of 2/15, net 45. (Enter your answers as directed, but do not round intermediate calculations.)
| Requirement 1: |
| What effective annual interest rate does the firm earn when a customer does not take the discount? (Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) |
| Effective annual interest rate | % |
| Requirement 2: |
| What effective annual interest rate does the firm earn if the discount is changed to 3 percent? (Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) |
| Effective annual interest rate | % |
| Requirement 3: |
| What effective annual interest rate does the firm earn if the credit period is increased to 65 days? (Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) |
| Effective annual interest rate | % |
| Requirement 4: |
| What effective annual interest rate does the firm earn if the discount period is increased to 20 days? (Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) |
| Effective annual interest rate | % |
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Real Estate Finance
Authors: Wolfgang Breuer, Claudia Nadler
2012th Edition
3834934496, 978-3834934499
