Many Consumers Who Do Online Banking Are Reluctant to Change

question 44

Multiple Choice

Many consumers who do online banking are reluctant to change banks because of the effort it would take to change automatic payments and online payments. The "cost" to change include the time and effort it would take to cancel old payments and set up new ones as well as the potential for missing a payment. These "costs" represent _____.

• A) opportunity costs
• B) barriers to switching
• C) switching costs
• D) barriers to entry
• E) contributory costs

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Definitions:

Annual Inflation Rate

The percentage increase in the price of goods and services over a one-year period, reflecting the decreasing purchasing power of a currency.

Purchasing Power

The measure of what one unit of currency can buy in terms of goods or services.

Compounded Monthly

The practice of calculating interest on the principal and the accumulated interest each month.

Compounded Semiannually

Interest that is calculated and added to the principal balance twice a year.