You Are Saving Money to Buy a Car

question 53

Multiple Choice

You are saving money to buy a car.If you save $300 per month starting one month from now at an interest rate of 4%,how much will you be able to spend on the car after saving for 4 years?

• A)$41,778.96
• B)$15,287.27
• C)$15,587.88
• D)$13,286.65
• E)$15,939.84

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Definitions:

Shares Outstanding

The cumulative amount of a company's shares that have been approved, distributed, and acquired by shareholders and currently possessed by them.

Debt-equity Ratio

A ratio used to express the relative use of equity and debt in funding a company’s assets.

Capital Spending

Expenditures by a company on major physical goods or services that are expected to generate economic benefits in the future.

Residual Dividend Policy

A strategy where a company pays dividends out of the residual or leftover equity only after all project capital needs are met.