Can you help me understand these questions?
27. Lengthening the credit period _____ the price paid by the customer. Generally, this acts to _____ sales. (Points: 3)
increases; have no effect on
28. Which of the following is not true concerning considerations in setting a credit policy? (Points: 3)
A firm that supplies a perishable product will tend to offer restrictive credit terms.
A firm whose customers are in a high-risk business will tend to offer restrictive credit terms.
Lengthening the credit period effectively reduces the price paid by the customer.
Small accounts, associated with firms that find it difficult to acquire a line of credit, tend to receive longer credit periods.
None of the above.
27. decreases; increase
Since the credit period is longer the customer actually saves on interest and ...
The solution explains some multiple choice questions relating to credit periods and credit policies