A trade credit discount such as 2/10 net 40 means

	a 2 percent penalty is due after 40 days.
	a 2 percent discount if payment is made within 10 days, otherwise, the total amount is due in 40 days.
	a 2 percent discount for payment within 10 days, and a 3 percent penalty if payment is made after 40 days.
	10 percent discount for cash on delivery and a 2 percent discount for payment within 40 days.

Determine the annualized opportunity cost of forgoing the trade discount on terms 1/20 net 45.

	14.55%
	15.24%
	16.78%
	20.69%

Cash management system objectives include

	maintaining sufficient cash to meet disbursal needs.
	maintaining idle cash balances at "doomsday event" levels.
	maintaining accounts payable balances at zero by early bill payment.
	All of the above are objectives of the system.