How Much Must Be Deposited on January 1, 2015 in a Savings

question 113

Multiple Choice

How much must be deposited on January 1, 2015 in a savings account paying 6% annually in order to make annual withdrawals of $25,000 at the end of the years 2015 and 2016? The present value of one at 6% for one period is .9434.

• A)$45,835
• B)$47,175
• C)$50,000
• D)$22,250

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Definitions:

Comparative Negligence

A legal doctrine that allocates damages based on the degree of fault of each party involved in an accident.

Contributory Negligence

A legal doctrine stating that if the plaintiff in a tort law case is found to be partially at fault for the accident, they may be barred from receiving compensation.

Unfounded Claims

Assertions or allegations that lack supporting evidence or basis in fact, often considered to be baseless or false.

Proximate Cause

The primary reason an event occurs that, in a natural and continuous sequence, leads to a legal injury, and without which the injury would not have occurred.