Which of the following changes to the terms of credit would make the effective annual rate increase?
A)Increase the cash discount percentage
B)Extend the discount period
C)Extend the payment period
D)All of these changes will increase the effective rate

Question

Quizplus · Accepted Answer

Increasing the cash discount percentage makes taking the discount more attractive, leading to a higher effective annual rate for those who choose not to take the discount.

Which of the Following Changes to the Terms of Credit