Suppose That You Need to Accumulate $10 000 in Three

question 29

Multiple Choice

Suppose that you need to accumulate $10 000 in three years in today's dollars. What monthly amount in nominal (actual) dollars should you save if your real rate of return is 5% and expected annual inflation rate is 3%?

• A)$246.14
• B)$258.04
• C)$268.96
• D)$275.14
• E)$281.96

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Definitions:

Avoidance-Avoidance Conflict

A psychological conflict that arises when an individual must choose between two equally unattractive options or actions.

Undesirable Routes

Pathways or approaches that are not preferred or desirable due to various reasons such as inefficiency or risk.

Approach-Avoidance Conflict

A psychological conflict that occurs when a goal is both appealing and unappealing at the same time, leading to ambivalence.

Positive and Negative Aspects

Factors or elements of a situation, decision, or phenomenon that can be beneficial (positive) or detrimental (negative).