At an Annual Interest Rate of 10 Percent,about How Many

question 1

Multiple Choice

At an annual interest rate of 10 percent,about how many years will it take $100 to triple in value?

• A)8
• B)10
• C)12
• D)14

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Definitions:

Face Value

The nominal or dollar value printed on a security, such as a bond or stock, which indicates its value at issuance or maturity.

Dividend Payments

Payments made by a corporation to its shareholder members, usually derived from the company's profits.

Discount Rate

A rate used to convert future cash flows into their present value, reflecting the opportunity cost of capital or the interest rate.

Perpetuity

An annuity that pays a constant amount to an investor at regular periods forever.