Suppose That Craig Nordstrom Deposits His $11,500 Bonus in an Account

question 12

Multiple Choice

Suppose that Craig Nordstrom deposits his $11,500 bonus in an account that earns an annual rate of 7.5%, compounded quarterly, and makes additional deposits of $800 at the end of each quarter for the next 24.5 years, until he retires. How much is in the account after the last deposit is made? Round your answer to the nearest cent. ​

• A)$362,815.63
• B)$220,793.91
• C)$71,010.86
• D)$149,783.06
• E)$291,804.77

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Definitions:

Compounded Semiannually

The process of applying interest to an investment or loan twice a year, resulting in compound growth.

Face Value

The nominal value or dollar value stated on a security or financial instrument, such as a bond.

Investment Yield

The income returned on an investment, such as the interest or dividends received, expressed as a percentage of the investment's cost.

Maturity Date

The specified date when the principal amount of a loan, bond, or other financial instrument is due to be paid in full.