How Much Will You Have in a Savings Account in Ten

question 113

Multiple Choice

How much will you have in a savings account in ten years,if you deposit $1000 in the account at the end of each year and the account earns 6% interest,compounded annually? (Future Value of $1,Present Value of $1,Future Value Annuity of $1,Present Value Annuity of $1. ) (Use appropriate factor from the PV tables.Round your final answer to the nearest dollar amount. )

• A)$10,000
• B)$10,600
• C)$13,181
• D)$17,906

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Definitions:

Lender

An individual, institution, or entity that provides funds to another with the expectation that the funds will be repaid, often with interest.

Utility Function

A mathematical representation that ranks an individual's preferences over a set of goods and services.

Interest Rate

The share of a loan subject to interest charges to the borrower, typically denoted as an annual percentage of the loan's outstanding sum.

Nominal Interest Rate

The stated interest rate on a loan or investment, not adjusted for inflation.