If You Invest $5,000 in a Mutual Fund with a Total

question 72

Multiple Choice

If you invest $5,000 in a mutual fund with a total annual return (interest rate) of 8% and you re-invest the proceeds each year,what will be the value of your investment after five years?

• A) $3,402.92
• B) $6,597.08
• C) $7,000.00
• D) $7,346.64

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Definitions:

Income Inequality

The imbalanced dispersion of income across various economic participants, including individuals and households.

Lorenz Curve

An illustrated chart that maps out the distribution of wealth or income among individuals in a society, revealing disparities.

Income Inequality

The unequal distribution of income among members of a society.

Gini Ratio

An assessment of the variation in income levels within a population, where 0 reflects equality in earnings and 1 reflects the highest possible inequality.