When Determining the Rate of Increase or Decrease Between Two

question 153

True/False

When determining the rate of increase or decrease between two amounts, first subtract the difference between the two amounts, then divide the difference by the original amount.​

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Definitions:

Contractual Interest Rate

The agreed-upon rate of interest that is to be applied on the principal amount of loans, bonds, or other forms of debt as specified within a contract.

Market Interest Rate

The rate of interest prevailing in the market that lenders demand and borrowers pay for funds.

Contractual Interest Rate

The agreed-upon rate of interest that is to be applied to the principal amount in a financial contract.

Discount

A reduction in the price of goods or services, typically offered to encourage purchases.