If a Checking Account Has an Interest Rate of 1

question 8

Multiple Choice

If a checking account has an interest rate of 1% and a Treasury bill has an interest rate of 3%, the opportunity cost of holding cash in a checking account is:

• A) zero.
• B) 0.02%.
• C) 1%.
• D) 2%.

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Definitions:

Attribution Theory

A psychological theory that explains how individuals interpret and assign causes to behaviors and events around them.

Positive Stressor

An event or situation that causes stress but is perceived as beneficial or motivating, leading to improved performance or well-being.

Distress

Emotional, mental, or physical strain or suffering that can negatively impact well-being.

Coping Strategy

Techniques or methods that individuals use to deal with stressful situations or emotions.