The calculated cost of trade credit for a firm that buys on terms of 2/10,net 30,is lower (other things held constant) if the firm pays in 40 days than in 30 days.

Name: The calculated cost of trade credit for a firm that buys on terms of 2/10,net 30,is lower (other things held constant) if the firm pays in 40 days than in 30 days.
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The cost of trade credit is lower if the firm pays in 40 days because the firm gets to use the money for an extra 10 days without paying any interest.

The Calculated Cost of Trade Credit for a Firm That