The Ajax Company Just Decided to Save $2,500 a Month

question 99

Multiple Choice

The Ajax Company just decided to save $2,500 a month for the next five years as a safety net for recessionary periods.The money will be set aside in a separate savings account which pays 3.25% interest compounded monthly.It deposits the first $2,500 today.If the company had wanted to deposit an equivalent lump sum today,how much would it have had to deposit?

• A)$134,964.59
• B)$135,189.29
• C)$137,428.87
• D)$138,648.81
• E)$139,998.01

---

Definitions:

Purely Competitive Firm

A business that operates in a market with many buyers and sellers, where each firm has no control over the market price and produces a homogeneous product.

Maximize Profit

The economic goal of efficiently allocating resources in production to achieve the highest possible return or profit.

Start-up Firms

New business ventures that are in the early stages of operation, often characterized by innovative products or services and high growth potential.

United States

A country located in North America, comprised of 50 states, a federal district, five major self-governing territories, and various possessions.