If You Pay Your $3,000 Tuition 3 Months Before It

question 269

Multiple Choice

If you pay your $3,000 tuition 3 months before it is due, the local college will give you a $250 "scholarship" reducing your tuition payment to $2,750. What is the annual simple interest rate to which this incentive is equal?

• A) 36.4%
• B) 9.1%
• C) 8.3%
• D) 33.3%
• E) 27.3%

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Definitions:

Variability

The extent to which data points in a statistical distribution or dataset differ from each other and from the mean or median of the data.

Sample Mean

The average of all observations or data points in a sample.

Standard Error

A statistical measure that describes the accuracy with which a sample represents a population, particularly in mean estimation.

Central Limit Theorem

A statistical theory that states that the distribution of sample means approximates a normal distribution as the sample size becomes larger, regardless of the population's distribution.