An Investment of $6000 at the Start of the Year

question 98

Multiple Choice

An investment of $6000 at the start of the year will pay $1000 at the end of the year for a set number of years.What is the minimum number of years these payments must be made for if the investment is to be worthwhile,given that the interest rate is 6%?

• A)6 years
• B)7 years
• C)8 years
• D)9 years
• E)10 years

Distinguish between different types of policies based on their objectives and targeted issues.

Understand the role and application of policy assessment tools such as matrices.

Appreciate the value of evidence and theoretical, professional, or moral grounds in defending policies.

Understand the STAR technique for answering behavioral interview questions and its components.

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Definitions:

Residual Value

The estimated amount that an asset is expected to realize upon its disposal at the end of its useful life.

Annual Depreciation

The portion of the total cost of a tangible asset that is expensed each year over its useful life.

Book Value

A rephrased definition: The net value of an asset or liability recorded on the financial statements, factoring in depreciation, amortization, and impairment, but not necessarily indicative of market value.

Activity-Based Method

An accounting method that assigns costs to products or services based on the activities and resources that go into producing them, to more accurately reflect the costs associated with each product or service.