You Set Up a College Fund in Which You Pay

question 1

Multiple Choice

You set up a college fund in which you pay $2,000 each year at the BEGINNING of the year.How much money will you have accumulated in the fund after 18 years,if your fund earns 7% compounded annually?

• A) $72,757.93
• B) $67,998.07
• C) $20,118.17
• D) $28,339.25

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Definitions:

Reducing Near-Term Dividends

A financial strategy involving the reduction of dividend payouts to shareholders in the short-term, typically with the aim of reallocating funds for company growth or debt reduction.

Future Dividends

Predicted payments made by a corporation to its shareholders out of its earnings in the future.

Stock Split

An action by a company to divide its existing shares into multiple shares to boost the liquidity of the shares, although the firm's overall market capitalization remains unchanged.

Common Stockholders' Equity

The portion of a company's equity that is held by common shareholders, representing ownership interest.