If an Asset Has a Present Value of $50 and Appreciates

question 57

Multiple Choice

If an asset has a present value of $50 and appreciates at an interest rate of 4%,what is the asset's future value in 47 compounding periods?

• A) Approximately $400
• B) Approximately $316
• C) Approximately $137
• D) Approximately $1143

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Definitions:

Cost of Goods Sold

This accounting term refers to the direct costs attributable to the production of the goods sold by a company, including labor, material, and overhead costs.

Rising Prices

A situation in which the general level of prices for goods and services in an economy increases over a period, often referred to as inflation.

Inventory Method

A system used by businesses to keep track of the quantity, status, and location of goods that they hold.

Gross Profit

The financial metric calculated by subtracting the cost of goods sold from sales revenue, indicating the efficiency of a company in managing its production and labor costs.