Compute the Future Value in Year 10 of a $1,000

question 105

Multiple Choice

Compute the future value in year 10 of a $1,000 deposit in year 1, and another $1,500 deposit at the end of year 4 using an 8 percent interest rate.

• A) $3,120.73
• B) $4,379.31
• C) $4,500.00
• D) $5,397.31

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Definitions:

Marginal Utility

The additional satisfaction or usefulness obtained from acquiring or consuming one more unit of a product or service.

Diminishing

A principle often seen where there is a decrease in the marginal (incremental) output of a production process as the amount of a single factor of production increases while others remain constant.

Donut

A fried dough confectionery or dessert food, usually sweet, and often served with a variety of toppings or fillings.

Total Utility

The total satisfaction received from consuming a particular quantity of a good or service.