Your Great Aunt Left You an Inheritance in the Form

question 45

Multiple Choice

Your great aunt left you an inheritance in the form of a trust. The trust agreement states that you are to receive $2,500 on the first day of each year, starting immediately and continuing for 20 years. What is the value of this inheritance today if the applicable discount rate is 4.75 percent?

• A) $24,890.88 
• B) $31,311.16 
• C) $33,338.44 
• D) $28,909.29 
• E) $29,333.33 

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Definitions:

Axon

A long, slender projection of a nerve cell, or neuron, that conducts electrical impulses away from the neuron's cell body.

Dendrite

Extensions of a neuron that receive signals from other cells and transmit them toward the cell body.

Myelin Sheath

A fatty layer that surrounds and insulates the axons of many neurons, speeding up the transmission of electrical signals along the nerve.

Receives Stimuli

The capacity of an organism or system to respond to environmental signals or changes.