Urgent MC Question Finding Effective Annual Cost

Gazapizm Corporation is a manufacturing company and has estimated that they need $2,400,000 to put a new pump into operation. The company can finance the the new pump by delaying payment to its suppliers. Presently the company has a supplier which sells on credit with credit terms of 2/15, net 45 days. If the firm does not take the discount and pays on the 50th day, then what is the effective annual cost? (Assume a 365-day year.)

1.
20.53%

2.
23.45%

3.
18.93%

4.
16.71%

Question

Urgent MC Question Finding Effective Annual Cost

Gazapizm Corporation is a manufacturing company and has estimated that they need $2,400,000 to put a new pump into operation. The company can finance the the new pump by delaying payment to its suppliers. Presently the company has a supplier which sells on credit with credit terms of 2/15, net 45 days. If the firm does not take the discount and pays on the 50th day, then what is the effective annual cost? (Assume a 365-day year.)

	1.	20.53%
	2.	23.45%
	3.	18.93%
	4.	16.71%

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Urgent MC Question Finding Effective Annual Cost Gazapizm Corporation is a manufacturing company and has estimated that they need $2,400,000 to put a new pump

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