Beginning Three Months from Now,you Want to Be Able to Withdraw

question 38

Multiple Choice

Beginning three months from now,you want to be able to withdraw $1,700 each quarter from your bank account to cover college expenses over the next 4 years.The account pays 1.25 percent interest per quarter.How much do you need to have in your account today to meet your expense needs over the next 4 years?

• A)$24,514.50
• B)$24,847.15
• C)$25,068.00
• D)$25,454.09
• E)$25,711.18

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Definitions:

Opportunity Costs

The penalty of not opting for the next superior alternative while making a decision.

Total Revenues

The total amount of income generated by the sale of goods or services related to the company's primary operations.

Economic Profits

The surplus or profit earned by a firm over and above the total costs of production, including both explicit and implicit costs, signifying an above-normal return.

Accounting Profits

The financial gain calculated by subtracting total explicit costs from total revenue, using generally accepted accounting principles (GAAP).