If You Put $200 in a Savings Account at the Beginning

question 42

Multiple Choice

If you put $200 in a savings account at the beginning of each year for five years and $300 at the beginning of each year for the next five years, how much will be in the account at the end of the 10th year? Assume that the account earns 10%, and round to the nearest $1.00.

• A)$3798
• B)$4178
• C)$4596
• D)$2750

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Definitions:

Price Level

The mean value of current prices for all goods and services produced within an economy, commonly utilized as a gauge for inflation.

Potential Level

An economic term referring to the highest level of output an economy can achieve when utilizing all its resources efficiently without triggering inflation.

Stock of Capital

The total value of all durable goods and assets held by an individual, company, or economy that can be used in the production of goods and services.

Expected Price Level

The anticipated average level of prices in the economy, usually considered in terms of inflation or deflation expectations.