In Front of Chris,Tasha Pours the Same Amount of Water

question 4

Multiple Choice

In front of Chris,Tasha pours the same amount of water into both a short,fat glass and a tall,thin glass.She then asks Chris which glass has more water.If Chris is 10 years old,he is most likely to answer

• A) the tall,thin glass.
• B) the short,fat glass.
• C) that they have the same amount of water.
• D) that he does not know.

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Definitions:

Strip Bonds

Bonds that have had their principal and coupon payments separated, or "stripped", creating two distinct types of securities: zero-coupon bonds and interest payment coupons.

Compounded Monthly

Refers to the process of adding interest to the principal balance of a loan or investment on a monthly basis, allowing the interest to then earn interest in the subsequent months.

Quadruple

To multiply or increase fourfold; also refers to a quantity that is four times as large as another.

Effective Annual Rate

The interest rate that is adjusted for compounding over a yearly period.