With the Power of Compounding, a $500 Deposit in a Savings

question 208

Multiple Choice

With the power of compounding, a $500 deposit in a savings account that earns 3% interest per year will earn how much in total interest after 10 years?

• A) less than 15%
• B) between 15% and 30%
• C) exactly 30%
• D) more than 30%

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Definitions:

Marginal Utility

The increased gratification or utility derived from the consumption of an extra unit of a good or service.

Energy Drink

A type of beverage containing stimulant compounds, usually caffeine, that is marketed as providing mental and physical stimulation.

Utility

Describes the complete fulfillment derived from the use of a product or service.

Demand Curve

A graph showing the relationship between the price of a good and the amount of the good that consumers are willing to purchase at that price, ceteris paribus.