The Effective Annual Rate (EAR)for a Loan with a Stated

question 113

Multiple Choice

The effective annual rate (EAR) for a loan with a stated APR of 8% compounded monthly is closest to:

• A)8.30%
• B)8.33%
• C)8.00%
• D)8.24%
• E)8.16%

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Definitions:

Absolute Threshold

The minimum stimulus intensity required to be perceived by a sensory system.

Absolute Thresholds

The minimum intensity of stimulation that must occur before you experience a sensation.

Candle Flame

The visible portion of a candle that is ignited, producing light and heat from the combustion process.

Sensation

The process by which sensory receptors and the nervous system receive and represent stimulus energies from our environment.