An Investor Deposited $10,500 in an Account

question 202

Multiple Choice

An investor deposited $10,500 in an account. At the end of year four, the account had accumulated $5,728.88. Over the first four years, the account earned ________ compounded annually.

• A) 11.5%
• B) 12.8%
• C) 14.6%
• D) 15.6%
• E) 23.1%

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Definitions:

Normal Good

A good for which demand increases as consumer income rises, and decreases as consumer income falls.

Income Increase

An income increase refers to a rise in the amount of earnings received by an individual or household, which can affect purchasing power and economic status.

Peanut Butter

Peanut Butter is a food paste or spread made from ground dry roasted peanuts, often containing additional ingredients that modify the taste or texture.

Decrease in Demand

A reduction in the quantity of a good or service that consumers are willing and able to purchase at various prices.