Three Years from Now, Barbara Waters Will Purchase a Laptop

question 21

Multiple Choice

Three years from now, Barbara Waters will purchase a laptop computer that will cost $2,250. Assume that Barbara can earn 6.25% (compounded monthly) on her money. How much should she set aside today for the purchase? Round off to the nearest $1.

• A) $1,250
• B) $900
• C) $1,866
• D) $3,775

---

Definitions:

Book Building

A process by which an underwriter attempts to determine the price to offer for an initial public offering based on demand from institutional investors.

Polling

Polling refers to the process of conducting surveys to collect information or opinions from a selected group of individuals, often used in market research, politics, and social science.

Bid Price

The highest price a buyer is willing to pay for a security or commodity.

Gross Trading Profit

The total profit from trading activities before deducting expenses and taxes.