You Are Considering an Investment That Is Expected to Pay

question 49

Multiple Choice

You are considering an investment that is expected to pay 3 percent in year 1, 5 percent in years 2 and 3 and 7 percent in year 4. If you invest $1,000 today, what will this investment be worth at the end of the fourth year?

• A) $1215.07
• B) $1215.51
• C) $1275.81
• D) $1285.75

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Definitions:

Raw Materials

Basic materials that are processed or refined to create goods and products in various industries.

Soviet Union

A former federation of Communist republics that was established in 1922 and dissolved in 1991, consisting of Russia and several other countries in Eurasia.

Supply

The aggregate quantity of a product or service that can be bought at any specific price point within a particular market.

Price Signals

Indications to consumers and producers about the scarcity or abundance of a good or service, guiding their economic decisions.