Suppose That You Have $100 Today and Expect to Receive

question 8

Multiple Choice

Suppose that you have $100 today and expect to receive $100 one year from today. Your money market account pays an annual interest rate of 25%, and you may borrow money at that interest rate. Suppose that you borrow $60 and spend $160 today. After you repay your loan one year from today, how much money will you have available for consumption one year from today?

• A)$0
• B)$25
• C)$50
• D)$75

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Definitions:

Caregivers

Individuals who provide care and assistance to those in need, such as children, the elderly, or the sick.

Racial

Pertaining to race or ethnicity, often used in the context of discussing diversity, ethnicity, and social dynamics.

Ethnic Groups

Collections of individuals who share common cultural, linguistic, or ancestral traits, distinguishing them from other groups.

Caregiver

Someone responsible for attending to the needs of a person who is elderly, sick, or disabled.