Which of the Following Statements Is Correct

question 138

Multiple Choice

Which of the following statements is correct?

• A)a. A 15-year mortgage will have larger monthly payments than a 30-year mortgage.
• B)b. If an account earns 3 percent per year compounded annually, then it also has an effective annual rate (EAR) of 3 percent.
• C)c. The present value of a $500 perpetuity is greater if the interest rate is higher.
• D)d. Statements a, b, and c are correct.
• E)e. Only statements a and b are correct.

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Definitions:

Biased Data

Refers to information that is skewed or unfairly influenced, leading to partial or misleading conclusions.

Spurious Inferences

Incorrect conclusions or assumptions that arise from flawed reasoning or misinterpretation of data.

Defect Exists

A phrase indicating the presence of a flaw, fault, or imperfection in a product, building, or system that could potentially cause harm or failure.

Expert Testimony

Evidence given in a court by a qualified professional about subjects needing specialized knowledge or expertise.