| 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.)
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| 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.) |
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% |
| 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.)
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| Effective annual interest rate | % |
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