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Q:

What is ‘Amortization’? 

Answer:



Q:

Which of the following best describes Accounting?

A) is an information system that provides reports to its stakeholders regarding economic activities and the condition of the business B) is used only for filling out tax returns and for financial statements for various types of governmental reporting requirements
C) records economic data but does not communicate the data to users according to any specific rules D) is of no use by individuals outside of the business
 
Answer & Explanation Answer: A) is an information system that provides reports to its stakeholders regarding economic activities and the condition of the business

Explanation:

Accounting is the systematic and comprehensive recording of financial transactions pertaining to a business. 

Which_of_the_following_best_describes_Accounting1537425183.gif image

Accounting also refers to the process of summarizing, analyzing and reporting these transactions to oversight agencies, regulators and tax collection entities. 

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Q:

The income and substitution effects account for

A) the upward sloping curve B) the downward sloping curve
C) Both A & B D) None of the above
 
Answer & Explanation Answer: B) the downward sloping curve

Explanation:
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1 52
Q:

An increase in the price of product A will

A) reduce the demand for resources used in the production of A. B) reduce the demand for substitute product B
C) increase the demand for complementary product C. D) increase the demand for substitute product B.
 
Answer & Explanation Answer: D) increase the demand for substitute product B.

Explanation:

If the price of a product rises, the demand for the substitute product increases.

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Q:

The interest-rate effect suggests that

A) an increase in the price level will increase the demand for money, increase interest rates, and decrease consumption and investment spending. B) a decrease in the supply of money will increase interest rates and reduce interest-sensitive consumption and investment spending
C) an increase in the price level will decrease the demand for money, reduce interest rates, and increase consumption and investment spending. D) an increase in the price level will increase the demand for money, reduce interest rates, and decrease consumption and investment spending.
 
Answer & Explanation Answer: A) an increase in the price level will increase the demand for money, increase interest rates, and decrease consumption and investment spending.

Explanation:
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Q:

Most financial investments are examples of what type of risk?

A) Credit risk B) Longevity risk
C) Human risk D) Inflation risk
 
Answer & Explanation Answer: C) Human risk

Explanation:

Most financial investments are examples of Human risk type of risks. Since, we humans invest in any kind of financial investments on our own risk expecting profits.

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Q:

The credit balance in the bank account is

A) amount liable to pay by bank B) amount liable to pay by customer
C) Both A + B D) None of the above
 
Answer & Explanation Answer: A) amount liable to pay by bank

Explanation:

Bank credit balance meant that the banker is laible to paid us.

And if we have a credit balance accouding to bank statement is mean we have " cash at bank" and in our book we show in the assets side but bank show laiblities side.

 

Hence, The credit balance in the bank account is the amiunt we have in our account and we are eligible to withdraw that.

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0 134
Q:

Which investment type typically carries the least risk?

A) Mutual funds B) Treasury bonds
C) Savings account D) Individual stocks
 
Answer & Explanation Answer: C) Savings account

Explanation:

Different types of risk exist in ivesting schemes depending on what you've invested in.

 

Savings accounts are generally regarded as the least risky investments as in this we just save our wealth for future expenses.

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0 139
Q:

Compounding interest means interest accrues

A) at variable rates throughout the term B) more quickly than simple interest
C) more slowly than simple interest D) at the same rate as simple interest
 
Answer & Explanation Answer: B) more quickly than simple interest

Explanation:

Compounding interest means interest accrues on the interest charged and the principal amount each period the interest is charged.

Compound interest is calculated by multiplying the principal amount by one plus the annual interest rate raised to the number of compound periods minus one.The total initial amount of the loan is then subtracted from the resulting value.

The formula for calculating compound interest is:

[P (1 + i)n] – P

= P [(1 + i)n – 1]

(Where P = Principal, i = nominal annual interest rate in percentage terms, and n = number of compounding periods.)


Take a three-year loan of Rs. 10,000 at an interest rate of 5% that compounds annually. What would be the amount of interest? In this case, it would be:

Rs. 10,000 [(1 + 0.05)3] – 1

= 10,000 [1.157625 – 1]

= Rs. 1,576.25.

 

How it grows ::

 

compound_interest1532497613.jpg image

 

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