Evaluate Round Dollar Amounts to the Nearest Cent and Other

question 260

Multiple Choice

Evaluate. Round dollar amounts to the nearest cent and other answers to the nearest thousandth when necessary.
- $$\mathrm { P } \left( 1 + \frac { \mathrm { r } } { \mathrm { k } } \right) ^ { \mathrm { kn } } \text { for } \mathrm { P } = \$ 1,000 , \mathrm { n } = 6 , \mathrm { r } = 7 \% \mathrm { k } = 1$$

• A) $1402.55
• B) $1605.78
• C) $500.73
• D) $1500.73

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Definitions:

Dividend Reinvestment Plans

Programs that allow investors to automatically reinvest their cash dividends into additional shares or fractional shares of the underlying stock.

Open Market

A freely competitive market where buyers and sellers can engage in transactions with minimal government intervention.

Debt Ratio

A financial ratio that measures the extent of a company's or individual's leverage in relation to the assets they own.

Transaction Costs

Expenses incurred when buying or selling securities, including commissions and the bid-ask spread.