Which of the Following Choices Will Result in a Greater

question 60

Multiple Choice

Which of the following choices will result in a greater future value at age 65? Choice number 1 is to invest $3,000 per year from ages 20 through 26 (a total of seven investments) into an account and then leave it untouched until you are 65 (another 39 years) .Choice number 2 is to begin at age 27 and make $3,000 deposits into an investment account every year until you are 65 years old (a total of 39 investments) .Each account earns an average of 10% per year.(The investments are end-of-year payments.)

• A)Choice 1 is better than choice 2 because it has a FV of $1,304,146.89,which is greater than choice 2 FV of $1,204,343.33.
• B)Choice 2 is better than choice 1 because it has a FV of $1,304,146.89,which is greater than choice 1 FV of $1,204,343.33.
• C)Choice 2 is better than choice 1 because it has a FV of $1,204,343.33,which is greater than choice 1 FV of $1,171,042.63.
• D)Choice 1 is better than choice 2 because it has a FV of $1,288,146.89,which is greater than choice 2 FV of $1,204,343.33.

---

Definitions:

Likelihood

The probability or chance of an event occurring, often assessed in decision-making processes.

Behavioral Consequences

The outcomes or results that follow from specific behaviors, which can reinforce or discourage the behavior.

Desired Behavior

Actions or conduct that are sought after or encouraged within a certain context, such as a workplace or community.

Reinforcement Schedule

A strategy in behavior analysis that determines how and when a behavior will be reinforced to encourage or discourage it.