Assume JP Morgan Has a Choice Between Two Deposit Accounts

question 73

Multiple Choice

Assume JP Morgan has a choice between two deposit accounts.Account A has an annual percentage rate of 7.55 percent but with interest compounded monthly.Account B has an annual percentage rate of 7.45 percent with interest compounded continuouslyquarterly.Which account provides the highest effective annual return?

• A)Account A
• B)Account B
• C)Both provide the same effective annual return.
• D)We don't have sufficient information to make a choice.

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Definitions:

Peter Salovey

An American social psychologist who contributed significantly to the development of emotional intelligence theory.

G Factor

A construct that refers to the general intelligence factor believed to underlie all cognitive abilities.

Overall Ability

The comprehensive capacity of an individual to perform tasks and solve problems across various domains.

Specific Abilities

Distinct skills or talents that relate to particular tasks or activities, highlighting the specialized aptitude an individual may possess.