How Does the Length of the Lever Arm Affect the Rate

question 29

Multiple Choice

How does the length of the lever arm affect the rate?

• A) A mutated shorter arm has a reduced rate.
• B) A mutated longer arm has a reduced rate.
• C) A mutated longer arm has a faster rate.
• D) A and B are correct.
• E) A and C are correct.

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Definitions:

Interest Rate

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.

Future Value

The worth of an asset or cash on a future date that has the same value as a certain amount presently.

Present Value

A calculation that determines the current worth of a future sum of money or stream of cash flows, given a specified rate of return.

Usury Laws

Regulations governing the amount of interest that can be charged on a loan, intended to prevent lending at excessively high rates.