The Real Risk-Free Rate Depends on the Real Growth in the Economy

question 66

True/False

The real risk-free rate depends on the real growth in the economy and can be affected for short time periods by temporary tightness or ease in the capital markets.

---

Definitions:

Ledger

A ledger is a comprehensive collection of a company's financial transactions, organized by account, during an accounting period.

Journalized

The process of recording financial transactions in a journal or the book of original entry.

Trial Balance

A bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit account columns to check for accuracy.

Offsetting Errors

Offsetting errors occur when two or more accounting mistakes cancel each other out, resulting in no net effect on the financial statements.