Comparison of Earnings for Different Savings Plans Can Best Be

question 84

Multiple Choice

Comparison of earnings for different savings plans can best be accomplished using the:

• A)discounted present value.
• B)compounding frequencies.
• C)net present value.
• D)annual percentage yield.
• E)after-tax rate of return.

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Definitions:

Standard Deviations

A statistical measure that quantifies the dispersion or variance of a set of data points from their average, widely used in the finance sector to gauge the volatility of investment returns.

Systematic Risk

The overall market risk that cannot be diversified away by holding a wide range of asset classes.

Market Risk

The risk of losses in investments due to factors that affect the overall performance of the financial markets.

Nondiversifiable Risk

Risk factors common to the whole economy; also called market risk or systematic risk.