Assume All Else Is Equal

question 68

Multiple Choice

Assume all else is equal.When comparing savings accounts, you should select the account that has the:

• A)lowest annual percentage rate.
• B)highest annual percent rate.
• C)highest stated rate.
• D)lowest effective annual rate.
• E)highest effective annual rate.

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Definitions:

Original Cost

The initial purchase price or construction cost of an asset or investment, not adjusted for inflation, depreciation, or other factors over time.

Fair Value

An estimate of the price at which an asset or liability could be exchanged in an orderly transaction between market participants at the measurement date.

Fair Value

An estimate of the market value of an asset, based on what a knowledgeable, willing, and unpressured buyer would likely pay to a seller.

Boot

Additional value or cash given along with a trade or exchange to equalize the value between traded items.