A $100 Deposit Today That Earns an Annual Interest Rate

question 3

Multiple Choice

A $100 deposit today that earns an annual interest rate of 10% is worth how much at the end of two years? Assume all interest received at the end of the first year is reinvested the second year.

• A)$100
• B)$120
• C)$121
• D)$122

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Definitions:

Independent Variable

An experimental variable that is changed or controlled to test its effects on dependent variables.

Coefficient Of Determination

A metric in statistics that evaluates the percentage of variability in the outcome variable that can be explained by the predictor variable(s).

SSE

Sum of Squared Errors, a measure used in statistics to quantify the discrepancy between data points and a model's predictions.

SSR

Sum of Squares due to Regression, a measure indicating how well a regression model fits the data.