Your Accountant Tells You That If You Can Continue to Earn

question 47

Multiple Choice

Your accountant tells you that if you can continue to earn the current interest rate on your balance of $800 for the next two years you will have $898.88 in your account. If your accountant is correct what is the current interest rate?

• A)6 percent
• B)7 percent
• C)8 percent
• D)9 percent

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Definitions:

Normal distribution

A statistical distribution where data is symmetrically distributed around the mean, often represented as a bell-shaped curve.

Interval estimate

An estimate of a population parameter that provides a range of values believed to contain the parameter.

Degrees of freedom

In statistics, it relates to the number of values in the final calculation of a statistic that are free to vary.

Confidence interval estimate

A range or interval of values, calculated from the sample data, within which the true population parameter is expected to lie, with a certain level of confidence.