For a Given Single Sum Invested at 8% for Four

question 49

Multiple Choice

For a given single sum invested at 8% for four years,how will the future value be affected if the compounding period is changed from quarterly to annually?

• A)The future value will decrease.
• B)The future value will increase.
• C)The future value will stay the same.
• D)There is not enough information to determine the impact.

---

Definitions:

Advertising Dollars

The amount of funding allocated to promotional activities in order to increase product or service visibility.

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing as scale is increased.

Value Chains

The full range of activities that businesses go through to bring a product or service from conception to delivery to the end user.

Economies of Scope

Cost advantages that a business obtains due to a broader range of operations or production levels.