Which of the Following Statements Is FALSE About Interest Rates

question 99

Multiple Choice

Which of the following statements is FALSE about interest rates?

• A) As interest rates may be quoted for different time intervals, it is often necessary to adjust the interest rate to a time period that matches that of cash flows.
• B) The effective annual rate indicates the amount of interest that will be earned at the end of one year.
• C) The annual percentage rate indicates the amount of simple interest earned in one year.
• D) The annual percentage rate indicates the amount of interest including the effect of compounding.

---

Definitions:

Employee Stock Ownership

A program where workers own shares of their employer's company, often used as an employee benefit plan.

Control

The power to influence or direct people's behavior or the course of events.

Creativity

The ability to produce original and unusual ideas, or to make something new or imaginative.

Innovation

The introduction of something new, such as an idea, method, technology, or product, that creates value or makes significant improvements over existing solutions.