The treasurer of a firm noted that many invoices
Chapter , Problem 3-48(choose chapter or problem)
The treasurer of a firm noted that many invoices werereceived with the following terms of payment:2%10 days, net 30 days. Thus, if he were to pay the billwithin 10 days of its date, he could deduct 2%. Onthe other hand, if he did not promptly pay the bill, thefull amount would be due 30 days from the date ofthe invoice.Assuminga 20-day compoundingperiod,the 2% deductionfor prompt paymentis equivalenttowhat effective annual interest rate?
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