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    Annual Percentage Discount Rate

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    Scrimpy Corporation buys materials from Frugal Enterprises. Frugal offers discount terms of 2/10, net 30. Assuming a 360-day year, what is the annual percentage rate associated with Scrimpy's failure to take advantage of the discount terms offered by Frugal?

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    Annual percentage rate of cash discount = % discount/(100-% ...

    Solution Summary

    This solution shows the steps for calculating the annual percentage rate in the given problem.