It Is Now 2030 and You Have Saved $250 000

question 6

Multiple Choice

It is now 2030 and you have saved $250 000 since you started saving in 2007.During the same period inflation averaged 3 percent.What would your $250000 be worth in 2007 dollars?

• A)$493 397
• B)$126 673
• C)$121 891
• D)$236 047

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Definitions:

Selling Price

The amount of money for which a product or service is sold to the customer.

Principal

An individual or entity that authorizes an agent to act on their behalf in legal or financial matters.

NPV Criterion

A financial metric used to assess the profitability of an investment, calculating the net present value of all cash flows associated with it.

Future Cash Flows

Estimates of the amount of money expected to be received or paid out in the future through investment, business operations, or other financial activities.