New World Chemical does not offer customers a cash discount for early payment of their accounts receivable.As a result,most customers wait to pay their bill on the last day before late penalties are charged.These customers apparently understand the:

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The customers apparently understand the time value of money, as they are waiting until the last possible moment to pay their bill in order to hold onto their cash for as long as possible and potentially earn interest on it. The other options (tax deductions, government regulations, and equity financing) do not directly relate to the customers' behavior regarding paying their bills.

New World Chemical Does Not Offer Customers a Cash Discount