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Credit terms . As manager of Fly-by-Night Airlines, you decide to allow customers 90 days to pay their bills. To encourage early payment, though, you
Credit terms. As manager of Fly-by-Night Airlines, you decide to allow customers 90 days to pay their bills. To encourage early payment, though, you allow them to reduce their bills by 1.5% if paid within the first 30 days. At what implied effective annual interest rate are you loaning money to your customers? What if you extend the discount to 60 days and allow full payment up to 180 days?
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