Which statement best explains why the Pag-IBIG MP2 savings program grows faster than a regular savings account?
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Answer: a. MP2 has no tax and a much higher dividend rate
- MP2 dividends (around 6–7% in recent years) are tax-free; a regular savings account pays about 0.1% and the interest is taxed 20%.
- Compounding frequency matters far less than the gap between 0.1% and 7%.