An Investment of $100 Today Is Worth $116

question 20

Multiple Choice

An investment of $100 today is worth $116.64 at the end of two years if it earns an annual interest rate of 8%.How much interest is earned in the first year and how much in the second year of this investment?

• A)The interest earned in year one is $8.32 and the interest earned in year two is $8.32.
• B)The interest earned in year one is $8.00 and the interest earned in year two is $8.64.
• C)The interest earned in year one is $8.64 and the interest earned in year two is $8.00.
• D)There is not enough information to solve this problem.

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Definitions:

Steiner's Law

A principle in social psychology that outlines how group productivity is determined by the sum of individual members' contributions, subject to the effects of coordination and motivation.

Group Productivity

Denotes the collective output or accomplishment of a group, often measured in terms of quantity, quality, and efficiency of work produced.

Faulty Process

A procedure or operation that is flawed or dysfunctional, often leading to errors or failures in achieving its intended outcome.

Unitary Task

An assignment or job that requires a unified or singular effort, often focusing on a specific objective or goal.