Suppose the Interest Rate Is 9% APR with Monthly Compounding

question 2

Multiple Choice

Suppose the interest rate is 9% APR with monthly compounding.Then the present value of an annuity that pays $250 every three months for the next five years is closest to:

• A)$2280.
• B)$3985.
• C)$3990.
• D)$3995.

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Definitions:

Special-interest Legislation

Special-interest legislation refers to laws or regulations enacted to benefit specific groups or interests, often at the expense of the broader public interest.

Concentrated Costs

Expenses that are not spread out but are borne largely by a small group.

Widespread Costs

involve expenses that affect a large segment of the economy, often implying that these costs are distributed across many individuals or entities.

Private-sector Provision

Services or goods provided by businesses owned by individuals or shareholders, rather than by the government.