-Rowan and Lisa Sharp Invested $10,000 in a Savings Account

question 39

Multiple Choice

-Rowan and Lisa Sharp invested $10,000 in a savings account paying 5% annual interest when their son, Jeremy, was born. They also deposited $500 on each of his birthdays until he was 20 (including his 20^th birthday) . Rowan and Lisa have obtained the following values related to the time value of money to help them with their planning process for their compounded interest decisions. To the closest dollar, how much was in the savings account on his 20^th birthday (after the last deposit) ?

• A) $53,066
• B) $43,066
• C) $30,000
• D) $26,533

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Definitions:

Fundamental Attribution Error

The bias of overattributing behaviors of others to their personal characteristics, while underestimating situational factors.

Perceptual Distraction

A phenomenon where the focus of attention is diverted due to irrelevant stimuli in the environment, affecting cognitive processes.

Self-serving Bias

The common tendency to credit ourselves for our successes (attributing them to internal factors) while attributing our failures to external factors.

Stereotyping Bias

The preconceived and oversimplified beliefs or ideas about particular groups of people, which can influence judgments and decisions unconsciously.