Your Big Brother Deposited $10,000 Today at 9% Interest for 6

question 155

Multiple Choice

Your big brother deposited $10,000 today at 9% interest for 6 years. You would like to have just as much money at the end of the next 6 years as your brother. However, you can only earn 7.5%
Interest. How much more money must you deposit today than your brother did if you are to have
The same amount at the end of the 6 years?

• A) $398.68
• B) $487.63
• C) $575.00
• D) $648.21
• E) $866.96

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Definitions:

Cash Dividends

Payments made by a corporation to its shareholders from the company's profits.

Equity Method

An accounting technique used to record investments in which the investor has significant influence over the investee but does not control it.

Statement of Cash Flows

A financial report summarizing the amount of cash and cash equivalents entering and leaving a company.