You Would Like to Deposit a Sum of Money Today

question 46

Multiple Choice

You would like to deposit a sum of money today that would enable you to withdraw $2,000 a year for ten years. If the interest paid on the amount deposited is 10% compounded annually and if the first withdrawal is made one year from today, the formula you would use to determine the amount of the initial deposit is the

• A) present value of a deferred annuity.
• B) present value of an annuity due.
• C) present value of an ordinary annuity.
• D) future value of an ordinary annuity.

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Definitions:

Contract Specifications

Contract Specifications refer to the detailed terms, conditions, and scopes outlined in a contract that specify the obligations and rights of the involved parties.

Uniform Computer Information Transactions Act

A proposed state law in the United States intended to standardize the law surrounding the licensing of software and other digital goods.

Software Vendors

Companies or individuals that develop and sell software products or services to consumers or businesses.

Perfect Tender Rule

A legal principle that requires the delivery of goods to be exactly as agreed in the contract without deviation.