Which One of These Methods Is the Fairest of Calculating

question 49

Multiple Choice

Which one of these methods is the fairest of calculating interest?

• A) Declining balance
• B) Adjusted balance
• C) Average daily balance excluding purchases
• D) Average daily including purchases method
• E) Previous balance method

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Definitions:

Turnover

Refers to the total sales generated by a company during a specific period.

ROI

Return on Investment; a financial metric used to evaluate the efficiency of an investment or compare the efficiency of several investments.

Return On Investment

Return on investment (ROI) is a financial metric used to evaluate the efficiency of an investment, calculated as the net profit divided by the cost of the investment.

ROI

Return on Investment is a performance measure used to evaluate the efficiency or profitability of an investment relative to its cost.