Emily Is Considering Two Mutually Exclusive Financial Options: (I)to Deposit

question 43

Multiple Choice

Emily is considering two mutually exclusive financial options: (i) to deposit $4 000 in her bank's savings account that pays 4.6% annual interest, or (ii) to purchase a $4 000 one-year guaranteed investment certificate with a monthly interest rate of 0.3%. From an opportunity cost standpoint, by making the decision to deposit $4 000 in the bank account, Emily will

• A)gain $37.6 by the end of the year.
• B)lose $37.6 by the end of the year.
• C)gain $57.6 by the end of the year.
• D)lose $57.6 by the end of the year.
• E)make zero economic profit.

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Definitions:

Welfare

A government program that provides financial aid and services to individuals and families in need.

Public Confidence

The level of trust and belief that the general public has in the effectiveness, integrity, and policies of an organization, institution, or government.

Political Institutions

Structures and mechanisms of social order and governance that support society's collective decision-making processes.

War on Terrorism

A global military campaign initiated by the United States after the September 11 attacks, aiming to eliminate international terrorism.