Which One of the Following Statements Concerning Interest Rates Is

question 105

Multiple Choice

 Which one of the following statements concerning interest rates is correct?

• A) Savers would prefer annual compounding over monthly compounding given the same annual percentage rate. 
• B) The effective annual rate decreases as the number of compounding periods per year increases. 
• C) The effective annual rate equals the annual percentage rate when interest is compounded annually. 
• D) Borrowers would prefer monthly compounding over annual compounding given the same annual percentage rate. 
• E) For any positive rate of interest, the annual percentage rate will always exceed the effective annual rate. 

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Definitions:

Reversible Figure

A visual pattern that easily allows more than one interpretation, in some cases changing the specification of figure and ground, in other cases changing the perceived organization in depth.

Lighter

A portable device used to generate a flame for the purpose of lighting something, such as a cigarette or candle.

Darker

Having very little light, not bright, or closer to black in color.

Gestalt Grouping

principles that describe how humans naturally organize visual elements into groups or unified wholes.