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As manager ofFly-by-Night Airlines, you decide to allow customers 90 90 days to pay their bills. To encourage earlypayment, though, you allow them to reduce
As manager ofFly-by-Night Airlines, you decide to allow customers 90
90 days to pay their bills. To encourage earlypayment, though, you allow them to reduce their bills by 1.9
1.9% if they pay within the first 56
56 days. At what implied effective annual interest rate are you loaning money to yourcustomers? What if you extend the discount to 68
68 days and allow full payment up to 180
180 days
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