Christopher Invests $400 Today at a 4% Rate of Return

question 2

Multiple Choice

Christopher invests $400 today at a 4% rate of return which is compounded annually. What is the future value of this investment after four years?

• A) $342
• B) $416
• C) $464
• D) $468

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Definitions:

Marginal Cost

The rise in expense associated with manufacturing an extra unit of a product or service.

Shut Down

A short-term decision by a company to cease operations temporarily due to unfavorable market conditions or to minimize losses when variable costs exceed total revenues.

Maximizes Profit

The strategy or process implemented to increase the difference between total revenue and total costs to the highest possible amount.

Marginal Revenue

Income gained by selling an additional unit of a product or service.