When Using the Effective Rate in Calculations

question 16

Multiple Choice

When using the effective rate in calculations,

• A)we need to apply annual compounding.
• B)we need to know the actual compounding frequency.
• C)we get an approximation of the actual value.
• D)we get a different result compared to calculations made with the nominal rate and the actual compounding frequency.

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Definitions:

Memory Span

the amount of information or number of items that a person can hold in short-term memory in one attempt, often measured by recollection tasks.

Anterograde Amnesiacs

Individuals unable to form new memories following the onset of amnesia, though memories from before the amnesia often remain intact.

Motor Skills

Abilities involving the movement and coordination of muscles to perform activities ranging from simple to complex movements.

Implicit Memory

A type of memory in which previous experiences aid the performance of a task without conscious awareness of these previous experiences.