Use the Following Timeline to Answer the Question(s)below

question 61

Multiple Choice

Use the following timeline to answer the question(s) below.
-At an annual interest rate of 7%,the future value of the cash flows in this timeline in year 2 is closest to:

• A)$3080.
• B)$3525.
• C)$3771.
• D)$4035.

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Definitions:

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, expressed as a percentage change.

Demand Curve

A graph showing the relationship between the price of a good and the quantity of that good that consumers are willing and able to purchase at various prices.

Price Elasticity

A gauge for the reaction of demand for a product to variations in its cost.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price.