When You Are Deciding Between Two Apartments, Assuming You Can

question 25

Multiple Choice

When you are deciding between two apartments, assuming you can afford both of them and they are both adequate for your needs, what feature should you pay most attention to if you want to maximize your satisfaction with the apartment a year after you have moved in?

• A) Rent-choose the cheapest apartment.
• B) Neighborhood quality-choose the most pleasant neighborhood with lots of things to do.
• C) Square footage-choose the biggest apartment.
• D) Both rent and square footage should affect your decision equally, and more so than neighborhood quality.

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Definitions:

Proceeds

refer to the total amount of money received from transactions, often associated with the sale of goods, services, or assets.

Effective-Interest Method

A method of calculating interest that considers the compounding of interest, making it a more accurate measure of interest expense or income over the life of a financial instrument.

GAAP

Generally Accepted Accounting Principles, a standard framework of guidelines for financial accounting used in any given jurisdiction.

Bond Discounts

The financial difference observed when a bond's selling price is less than its stated face value upon sale.