Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

7. Receivables and Investments

Introduction to Investments in Securities

Financial Accounting

7. Receivables and Investments

Introduction to Investments in Securities

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Multiple Choice

Which method of funding higher education accrues interest until it is paid back?

Scholarships

Grants

Student loans

Work-study programs

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Verified step by step guidance

Understand the concept of student loans: Student loans are a form of financial aid that must be repaid with interest. Unlike scholarships or grants, which are typically non-repayable, student loans accrue interest over time until they are fully paid back.

Differentiate between the funding methods: Scholarships and grants are financial awards that do not require repayment, while work-study programs involve earning money through part-time jobs to fund education. Student loans, however, involve borrowing money that accrues interest.

Recognize the key characteristic of student loans: Interest begins to accumulate on the borrowed amount either immediately or after a grace period, depending on the type of loan (e.g., subsidized or unsubsidized). This is a defining feature of student loans compared to other funding methods.

Consider the repayment process: Student loans are repaid over time, typically after the borrower graduates or leaves school. The repayment includes both the principal amount and the accrued interest.

Apply this understanding to the question: Since student loans are the only funding method listed that accrues interest until paid back, they are the correct answer to the question.