Which One of the Following Statements Concerning Interest Rates Is

question 44

Multiple Choice

Which one of the following statements concerning interest rates is correct?

• A)The stated rate is the same as the effective annual rate.
• B)Banks are most apt to prefer more frequent compounding on their savings accounts.
• C)The annual percentage rate increases as the number of compounding periods per year increases.
• D)An effective annual rate is the rate that applies if interest were charged annually.
• E)For any positive rate of interest,the effective annual rate will always exceed the annual percentage rate.

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Definitions:

Attention Narrowing

The phenomenon where focus is restricted to a limited range of stimuli or tasks, ignoring peripheral information.

Stimulants

Drugs that have activating or excitatory effects on brain or bodily functions.

Alcohol

A psychoactive substance commonly found in beverages such as beer, wine, and spirits, known for its depressant effects on the central nervous system.

Depressant

A category of psychoactive drugs that reduce arousal and stimulation, affecting the central nervous system to slow down bodily functions.