Which One of the Following Statements Concerning Interest Rates Is

question 53

Multiple Choice

Which one of the following statements concerning interest rates is correct?

• A)The stated rate is the same as the effective annual rate.
• B)An effective annual rate is the rate that applies if interest were charged annually.
• C)The annual percentage rate increases as the number of compounding periods per year increases.
• D)Banks prefer more frequent compounding on their savings accounts.
• E)For any positive rate of interest, the effective annual rate will always exceed the annual percentage rate.

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Definitions:

Erikson

A psychologist known for developing a theory of psychosocial development that outlines eight stages people go through in their lifetime.

Generativity

A stage of adult development where the focus is on guiding the next generation and contributing to society.

Intimacy

A personal connection that is intimate, friendly, and often characterized by affection or love with another person or group.

Elisabeth Kübler-Ross

a psychiatrist known for her pioneering work on the five stages of grief and death.