You Have Just Purchased an Investment That Generates the Cash

question 117

Multiple Choice

You have just purchased an investment that generates the cash flows that are shown below.You are able to invest your money at 5.75%,compounded annually.How much is this investment worth today?
Year Amount
0 $0
1 $1,250
2 $1,585
3 $1,750
4 $2,225
5 $3,450

• A)$7,758
• B)$4,521
• C)$10,260
• D)$8,467

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Definitions:

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IM Injection

Intramuscular injection, a method of administering medication deep into the muscles, allowing the medication to be absorbed into the bloodstream quickly.

Multidose Vial

A vial of liquid medication intended for use in more than one dose, often containing a preservative to inhibit microbial growth.