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:

Positive Reinforcement

A process in which the introduction of a stimulus following a particular behavior increases the likelihood of the behavior's occurrence.

Positive Punishment

A form of behavior modification where something unfavorable is added after a behavior, with the intention of decreasing the likelihood of that behavior being repeated.

Observational Learning

Learning that occurs through observing the behaviors of others and imitating those behaviors without direct instruction or reinforcement.

Operant Conditioning

A process of teaching in which behavior modification occurs as a result of either encouraging rewards or imposing punishments.