An APR Will Be Equal to an Effective Annual Rate

question 24

Multiple Choice

An APR will be equal to an effective annual rate if:

• A)Simple interest is used
• B)Compounding occurs continuously
• C)Compounding occurs annually
• D)An error has occurred; these terms cannot be equal

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Definitions:

Familiarity Effect

The tendency to develop a preference for things merely because they are familiar.

Repeated

Occurring or done again and again, often to achieve a particular effect or to reinforce a concept or skill.

Social Cognition

The process of understanding how people think about themselves and others, including how they interpret, analyze, remember, and use information about the social world.

Social Psychology

The scientific study of how people's thoughts, feelings, and behaviors are influenced by the actual, imagined, or implied presence of others.