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Robert, an Aspiring Scientist in a Biology Class, Wanted to Conduct

question 8

Multiple Choice

Robert, an aspiring scientist in a biology class, wanted to conduct a study on the effects of cigarette smoke on the web-building ability of spiders. Which of the following statements is an incorrect use of terms pertaining to the scientific method?


Definitions:

Simple Annualized Yield

A calculation of investment earnings that does not account for compounding within the year, expressed as an annual rate.

Effective (Annualized) Yield

The effective, or annualized yield, calculates the return on an investment by taking into account the effect of compounding interest over a one-year period.

Quarterly Compounding

The process of calculating interest and adding it to the principal sum of a loan or deposit on a quarterly basis.

Effective Rate

The interest rate on a loan or investment, adjusted for the effect of compounding over a given period.

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