An Initial Investment of $2000 Grows at an Annual Interest

question 39

Multiple Choice

An initial investment of $2000 grows at an annual interest rate of 4% compounded continuously.How long will it take to double the investment?

• A)17.33 years
• B)18.33 years
• C)18.00 years
• D)17.00 years
• E)1 year

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Definitions:

Rational Choice

The theory in economics and sociology that suggests individuals always make prudent and logical decisions that provide them with the highest amount of personal utility.

Positively Correlated

Describes a relationship between two variables where they move in the same direction, meaning if one variable increases, the other also increases and vice versa.

Causation

The relationship between cause and effect, where one event (the cause) directly results in the occurrence of another event (the effect).

Loaded Terminology

Phrases or words that contain implicit meanings or emotions designed to influence the listener or reader’s view.