Five Years Ago, Precision Tool Set Aside $50,000 in Case

question 105

Multiple Choice

Five years ago, Precision Tool set aside $50,000 in case of a financial emergency. Today, that account has increased in value to $64,397. What rate of interest is the firm earning on this money?

• A) 5.19%
• B) 5.47%
• C) 6.18%
• D) 6.32%
• E) 6.45%

---

Definitions:

Average Fixed Cost

The total fixed costs of production divided by the quantity of output, showcasing how fixed costs per unit change with production levels.

Output

The total quantity of goods or services produced by a firm, industry, or economy in a specific period.

Variable Inputs

Inputs or resources whose usage changes according to the level of production.

Unit Costs

The cost incurred by a company to produce, store, and sell one unit of a particular product or service.