You Want to Buy a New Car in Five Years

question 13

Multiple Choice

You want to buy a new car in five years. You want to have saved $25,000 by then. You can invest $4,000 at the end of each of the next five years at an interest rate of 6% compounded annually. Will you have enough money at the end of the fifth year?

• A) No. You are short $2,452.
• B) Yes. You have $1,532 more than you need.
• C) No. You are short $1,532.
• D) Yes. You have $2,452 more than you need.
• E) None of the answers is correct.

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Definitions:

Primary Groups

Close-knit groups such as family or close friends, characterized by long-term, intimate, and face-to-face interaction which significantly influences the attitudes and ideals of those involved.

Strong Moral Values

Principles or standards of behavior that are considered important and virtuous by a society or individual.

Self-Organizing Group

A group that forms and organizes itself naturally based on common interests or goals, often without a formal leadership structure.

Primary Group

A small social group characterized by close, personal, and enduring relationships, often significant in the development of social identity.