An Escrow Account

question 9

Multiple Choice

An escrow account:

• A) Ensures that a default insurance policy does not lapse if a borrower is in danger of default
• B) Ensures that sufficient funds are collected to make annual hazard insurance and property tax payments
• C) Is a non-interest-bearing account into which a borrower prepays certain fees and taxes
• D) All of the above
• E) None of the above

Recognize common myths and misconceptions about research designs.

Acknowledge the significance of resource consideration in the selection of a research design.

Understand the role of ruling out rival hypotheses and the importance of validity in research design.

Identify the components of research and their functions.

---

Definitions:

Convertible Debt

A type of bond or other form of debt that can be converted into a specified number of shares of the issuing company's stock at certain times during its life.

GAAP

Generally Accepted Accounting Principles, a set of accounting standards, principles, and procedures that companies must follow when compiling their financial statements.

APB

The Accounting Principles Board, which was an organization that set standards for financial reporting and accounting in the past, succeeded by the FASB.

Effective Interest Method

A technique used in finance to calculate the actual interest rate on a bond or loan, considering compounding over the term.