Question
XYZ is deciding among 3 loans that would each involve her receiving $8,000 today and then paying back the original principal and all accrued interest
XYZ is deciding among 3 loans that would each involve her receiving $8,000 today and then paying back the original principal and all accrued interest in 1 year from today. Loan A has an APR of 16.40%, compounded annually. Loan B has an APR of 15.60%, compounded continuously. Loan C has an APR of 15.60%, compounded quarterly. Which of the following assertions is true if XYZ prefers loans with lower costs more than she prefers loans with higher costs?
| a. | XYZ would prefer loan A to loan B and XYZ would prefer loan A to loan C | |
| b. | XYZ would prefer loan A to loan B and XYZ would prefer loan C to loan A | |
| c. | XYZ would prefer loan B to loan A and XYZ would prefer loan A to loan C | |
| d. | XYZ would prefer loan B to loan A and XYZ would prefer loan C to loan A |
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Health Care Finance Basic Tools For Nonfinancial Managers
Authors: Judith J. Baker, R.W. Baker, Neil R. Dworkin
5th Edition
1284118215, 978-1284118216
