Please..I need help asap
If a firm pays its bill with a 30 day delay, what fraction of its purchases will be in paid in the current quarter?
Please show me how you get this answer
Since a quarter is three months long, then 2/3 of the firm's purchases are paid in the quarter in which they were made.
To calculate the fraction of purchases that will be paid in the current quarter, you need to consider the delay period and the length of a quarter.
Given that the firm pays its bills with a 30-day delay, this means that any purchases made within the quarter will be paid during the next quarter. Therefore, the fraction of purchases paid in the current quarter would exclude those made in the last 30 days of the quarter.
Since a quarter is three months long, and the firm pays with a 30-day delay, you subtract one month (30 days) from the three-month quarter. This leaves you with two months, which represents 2/3 of the quarter.
So, the fraction of purchases paid in the current quarter would be 2/3.