Which of the Following Statements Is False Regarding REA Diagrams

question 64

Multiple Choice

Which of the following statements is false regarding REA diagrams?

• A)Each organization will have its own unique REA diagram.
• B)An REA diagram for a given organization will change over time.
• C)Data modeling and REA diagram development involve complex and repetitive processes.
• D)Redrawing an REA diagram several times during development is uncommon.

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Definitions:

Interest Rate

The amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Interest Rate

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the outstanding loan.

Discounting

The procedure used to calculate the present value of future income, which is inversely related to both the interest rate and the amount of time that passes before the funds are received.