Use the Information for the Question(s)below

question 88

Multiple Choice

Use the information for the question(s) below.
Assume that you are 30 years old today and that you are planning on retirement at age 65.Your current salary is $45,000 and you expect your salary to increase at a rate of 5% per year as long as you work.To save for your retirement,you plan on making annual contributions to a retirement account.Your first contribution will be made on your 31st birthday and will be 8% of this year's salary.Likewise,you expect to deposit 8% of your salary each year until you reach age 65.Assume that the rate of interest is 7%.
-You are offered an investment opportunity that costs you $28,000,has an NPV of $2278,lasts for three years,has interest rate of 10%,and produces the following cash flows: The missing cash flow from year 2 is closest to:

• A)$12,500.
• B)$12,000.
• C)$13,000.
• D)$10,000.

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Definitions:

Administration

The process of managing and overseeing the operations of an organization or institution, or the execution of policies and decisions.

Benzodiazepine

A class of psychoactive drugs known for their sedative, hypnotic, anxiolytic, and muscle relaxant properties.

Valium

A prescription medication used to treat anxiety, muscle spasms, seizures, and other conditions, known for its calming effects.

Anxiety Disorder

A mental health disorder characterized by feelings of worry, anxiety, or fear that are strong enough to interfere with one's daily activities.