A Principal of $7,650 Is Invested at a Rate of 3.7

question 4

Multiple Choice

A principal of $7,650 is invested at a rate of 3.7% compounded annually. After how many years will the investment first exceed $12,250?

• A)16
• B)14
• C)15
• D)13
• E)12

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Definitions:

Rational Expectations

An economic theory suggesting individuals make predictions about the future based on available information and past experience, influencing their economic decisions.

Monetary Policy

The process by which a government, central bank, or monetary authority manages the supply of money and interest rates to achieve macroeconomic objectives.

Stimulate Economy

Initiatives or policies undertaken to encourage economic growth or enhance economic performance.

Rational Approach

A decision-making process based on logical, systematic analysis of data and information to optimize outcomes.