How Are Explanations Distinguished in the Journal

question 15

Multiple Choice

How are explanations distinguished in the journal?

• A)They are underlined.
• B)They are in bold print.
• C)They are indented below the credit entries.
• D)They are written at the margin,in line with the debit entries.

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Definitions:

Present Value

A financial concept that calculates the current worth of a future sum of money or stream of cash flows given a specified rate of return.

Interest Rate

A financial term denoting the amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.

Equilibrium Interest Rate

The interest rate at which the demand for loanable funds equals the supply of loanable funds, balancing savings and investment in the economy.

Total Spending

The sum of all expenditures made by consumers, businesses, and the government within an economy over a specific period.