A Money Factor of 0

question 130

Multiple Choice

A money factor of 0.00280 on a lease is equivalent to an annual percentage rate of

• A) 2.80.
• B) 3.60.
• C) 6.72.
• D) 8.64.
• E) 10.80.

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Definitions:

Rate of Return

The positive or negative change in the worth of an investment, quantified over a predetermined period and depicted as a percentage of the initial investment cost.

Portfolio

A collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, including mutual funds and ETFs.

Successive Years

Successive years that occur back-to-back without any breaks.

Compounded Quarterly

A method of calculating interest where it is added to the principal four times a year, after every three months, leading to faster growth of the investment.