Which of the Following Statements Is Correct, Assuming Positive Interest

question 80

Multiple Choice

Which of the following statements is correct, assuming positive interest rates and holding other things constant?

• A) Banks A and B offer the same annual rate of interest, but A pays interest quarterly and B pays semiannually. A deposit in Bank B will have a higher value in five years.
• B) Banks A and B offer the same nominal annual rate of interest, but A pays interest quarterly and B pays monthly. A deposit in Bank B will have a higher value in five years.
• C) Banks A and B offer the same nominal annual rate of interest, but A pays interest daily and B pays semiannually. A deposit in Bank B will have a higher value in five years.
• D) Banks A and B offer the same nominal annual rate of interest, but A pays interest weekly and B pays quarterly. A deposit in Bank B will have a higher value in five years.

---

Definitions:

Brain Waves

The electrical activity in the brain, which is often categorized into various types such as alpha, beta, delta, and theta waves, each associated with different states of consciousness and mental activities.

Complete Night's Sleep

A full duration of sleep throughout the night, typically considered to be between 7 to 9 hours for adults, vital for optimal health and well-being.

Insightfully Discern

The ability to perceive or understand something deeply with clarity and accuracy.

Extreme Inertia

The resistance of an organization to change, even in the face of required adjustments or obvious opportunities for improvement or innovation.