At the End of Each Year for the Next 10

question 55

Multiple Choice

At the end of each year for the next 10 years you will receive cash flows of $51. If the appropriate discount rate is 5.5%, how much would you pay for the annuity?

• A) $259.82
• B) $299.02
• C) $338.99
• D) $384.42
• E) $379.16

---

Definitions:

Close Substitutes

Goods or services that can serve as replacements for each other with minimal difference in utility for the consumer.

Oligopolistic

Describing a market structure dominated by a few large producers or sellers who have significant control over prices and market share, often resulting in limited competition.

Monopolistic

Relates to a market structure where a single firm dominates the market, often leading to limited competition.

Differentiate Products

The strategy of distinguishing a product from its competitors through design, features, branding, or quality.