Revision as of 01:15, 18 November 2023 by Admin (Created page with "A retailer offers two payment plans: # A 2% discount if paid within 10 calendar days after purchase # Pay the full amount on the 30th day after purchase Assume a 365-day year. The implied annual effective yield the buyer is charged for delaying payment from day 1 to day 30 is i. Calculate i. <ul class="mw-excansopts"><li>24.3%</li><li>26.8%</li><li>27.9%</li><li>36.5%</li><li>44.6%</li></ul> {{soacopyright | 2023 }}")
ABy Admin
Nov 18'23
Exercise
A retailer offers two payment plans:
- A 2% discount if paid within 10 calendar days after purchase
- Pay the full amount on the 30th day after purchase
Assume a 365-day year.
The implied annual effective yield the buyer is charged for delaying payment from day 1 to day 30 is i.
Calculate i.
- 24.3%
- 26.8%
- 27.9%
- 36.5%
- 44.6%
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.
ABy Admin
Nov 18'23
Solution: E
[[math]]
\left(\frac{1}{0.98}\right)^{365/20} -1 = 44.6\%
[[/math]]
- 24.3%
- 26.8%
- 27.9%
- 36.5%
- 44.6%
Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.