What would be the nominal and effective cost of trade credit
Problem
REDD Inc. buys $5.5 billion of materials on terms of 2/10, net 50 and currently pays on the 10th day and takes discounts. If the firm foregoes the discount, what would be the nominal and effective cost of trade credit?
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REDD Inc. buys $5.5 billion of materials on terms of 2/10, net 50 and currently pays on 10th day. What would be the nominal and effective cost of trade credit?
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