Your Mother Helped You Start Saving $10 a Month Beginning

question 356

Multiple Choice

Your mother helped you start saving $10 a month beginning on your 5th birthday, which is on May 1st. She always made you make your deposit on the first day of each month just to "start the month
Out right". Today, you turn 21 and have $6,984 in your account. What is the rate of return on your
Savings?

• A) 13.62%
• B) 13.68%
• C) 13.75%
• D) 13.81%
• E) 13.86%

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Definitions:

Net Income

A financial metric indicating the amount of revenue that remains as profit for a period after all expenses and taxes have been paid.

Common Stock

A form of investment indicating a stake in a corporation, which bestows upon its owners the right to vote and receive a portion of the company's earnings through dividends.

Net Cash

The amount of cash available after deducting cash outflows from cash inflows.

Investment Activity

Investment activity involves the allocation of capital to assets or projects with the expectation of generating future returns, contributing to a company's growth or financial health.