A firm offers terms of 2.2/7, net 60

jagguarpaw January 9, 2017 0 Comments
A firm offers terms of 2.2/7, net 60

 

a. What effective annual interest rate does the firm earn when a customer does not take the discount? (Use 365 days a year. Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

 

 

Effective annual interest rate %

 

b. What effective annual interest rate does the firm earn if the terms are changed to 3.2/7, net 60, and the customer does not take the discount? (Use 365 days a year. Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

 

 Effective annual interest rate
%

 

d. What effective annual interest rate does the firm earn if the terms are changed to 2.2/12, net 60, and the customer does not take the discount? (Use 365 days a year. Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

 

 

  Effective annual interest rate %