You Place $500 into Your Checking Account at First Bank

question 75

Multiple Choice

You place $500 into your checking account at First Bank and earn 1% APR on your deposit.Your professor borrows money at a rate of 8% from the same bank for a tuition loan for her son.Which of the following statements is true?

• A)The bank is criminally liable to you for paying an interest rate lower than the expected rate of inflation.
• B)You and your professor have an obvious conflict of interest because you have accounts at the same financial institution.
• C)You benefit from earning interest on your deposit,safety for your funds,and having a recognizable means for paying for your financial obligations without having to hold cash.
• D)Your professor is the only party to be made worse off by this example because she is the only party paying net interest.

---

Definitions:

Cross-Sectional Research

A form of study that observes and analyzes information from a population or a representative segment thereof at a distinct point in time.

Longitudinal

A type of study or research design where the same subjects are observed repeatedly over a period of time.

Basic

Referring to the fundamental, essential, or primary part or level of something, often used to describe concepts or skills that serve as a foundation.

Longitudinal Research

A study design that involves repeated observations of the same variables or groups over a period of time, often years or decades, to track changes or developments.