Suppose the Annual Rate of Interest Is R Percent

question 80

Multiple Choice

Suppose the annual rate of interest is r percent.Which of the following statements is true of the future value of $1,000 for a time of T years?

• A) Irrespective of whether the sum of $1,000 is borrowed or lent, the future value in both cases will equal (1 ‒ r)ᵀ × $1,000.
• B) Irrespective of whether the sum of $1,000 is borrowed or lent, the future value in both cases will equal (1 + r)ᵀ × $1,000.
• C) If $1,000 is borrowed, the future value will equal (1 + r)ᵀ × $1,000, but if it is lent out, the future value will equal (1 ‒ r)ᵀ × $1,000.
• D) If $1,000 is borrowed, the future value will equal (1 ‒ r)ᵀ × $1,000, but if it is lent out, the future value will equal (1 + r)ᵀ × $1,000.

---

Definitions:

Shoes

Footwear items designed to protect and comfort human feet while offering support for various activities.

Lungs

Paired respiratory organs situated within the thorax of mammals and many other organisms, essential for breathing and exchanging oxygen and carbon dioxide.

Heart

A muscular organ in most animals, which pumps blood through the circulatory system by rhythmic contraction and dilation.

Tonsils

Lymphoid tissues located in the pharynx that play a role in protecting the body from respiratory and gastrointestinal infections.