Lima Corporation makes purchases on credit with terms of 2/15, net 45. What is the effective annual rate (rEAR) of non-free trade credit if Lima does not take discounts and pays on Day 45? In your computations, assume there are 360 days in a year.

A. 42.98%
B. 24.49%
C. 148.21%
D. 35.40%
E. 27.43%


Answer: E

Business

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