Solve the Problem $\$ 4,000$ Is Put Aside in a Money Market Account with Interest

question 74

Multiple Choice

Solve the problem.
-If $\$ 4,000$ is put aside in a money market account with interest compounded continuously at $3.1 \%$ , find the time required for the account to earn $\$ 1000$ . Round to the nearest month.

• A) \(7 \mathrm { yr } , 10\) months
• B) \(5 \mathrm { yr } , 11\) months
• C) \(8 \mathrm { yr } , 2\) months
• D) \(7 \mathrm { yr } , 2 \mathrm { months }\)

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Definitions:

Quantity Discounts

Price reductions given to customers for purchasing large volumes of a product, aimed at encouraging bulk buying and increasing sales volume.

Cost-Minimizing Solution

A cost-minimizing solution is an economic strategy or method that aims to achieve the lowest possible cost while fulfilling certain conditions or requirements.

Annual Holding Costs

The total cost associated with storing and maintaining inventory over a year, including warehousing, insurance, and depreciation.

Ordering Costs

Expenses associated with placing and receiving orders for goods or services, including administrative costs and transportation.