The Sum of the Terms of the Infinite Geometric Series

question 16

Multiple Choice

The sum of the terms of the infinite geometric series 1, 0.83, 0.83², 0.83³, ...is closest to

• A)infinity.
• B)1.83.
• C)5.88.
• D)0.55.
• E)120.48.

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Definitions:

Return On Investment

A performance measure used to evaluate the efficiency or profitability of an investment, calculated by dividing the profit from an investment by the cost of the investment.

Price Per Unit

Price per unit describes the cost of a single unit of product or service, providing a basis for evaluating and comparing the value of similar items.

Full Cost

The comprehensive total of all costs associated with producing a product or delivering a service, including direct, indirect, fixed, and variable costs.

Cost-Plus Pricing

A pricing strategy where the selling price is determined by adding a specific markup to a product's cost price to ensure a profit margin is achieved.