Income Is a Variable Often Used in Business and Economics

question 46

Multiple Choice

Income is a variable often used in business and economics. Income is an example of a variable that uses the

• A)ordinal scale.
• B)nominal scale.
• C)ratio scale.
• D)interval scale.

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Definitions:

Compounded Monthly

The process of calculating interest on an initial principal, which also includes all of the accumulated interest from previous periods on a loan or investment, with the compounding occurring on a monthly basis.

Effective Annual Rate

The interest rate on an investment or loan that considers the effects of compounding over a given time period.

Compounded Quarterly

An investment or loan interest calculation method where interest is added to the principal four times a year.

Effective Annual Rate

The interest rate on an investment or loan that is annualized, taking compounding into account.