Bank One Currently Charges a 10 Percent Simple Rate on a Car

question 131

Multiple Choice

Bank One currently charges a 10 percent simple rate on a car loan where the interest is compounded semiannually.Bank Two offers a car loan where the interest is compounded quarterly.What simple rate would Bank Two have to charge in order to earn the same effective annual rate that is earned by Bank One?

• A) 9.25%
• B) 9.88%
• C) 10.00%
• D) 10.25%
• E) 10.42%

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Definitions:

Partnership

A lawful business structure involving two or more people who divide both management responsibilities and earnings.

Entity

A unit, existence, or being that can be legally or conceptually distinct, such as a corporation, partnership, individual, or any organized group.

Lawn Care Service

A business specialized in maintaining and grooming outdoor landscapes, primarily focusing on lawns and garden areas.

Name Considerations

Refers to the implications and legal aspects of choosing or using a specific name in a business or branding context.