After 12 ½ Years Contributions of $750 at the End

question 89

Multiple Choice

After 12 ½ years contributions of $750 at the end of each semi-annual period has accumulated into $24,510.47. If interest rate is compounded semi-annually, determine the effective annual rate of the investment.

• A) 8.08%
• B) 8.62%
• C) 9.08%
• D) 9.58%
• E) 10.08%

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Definitions:

Revocable Living Trust

A trust document created by an individual that can be amended or revoked during their lifetime, used often for estate planning purposes.

Estate Tax

Estate tax is a tax levied on the net value of the estate of a deceased person before it is distributed to the heirs.

Management Advantages

The benefits or competitive edge that a company obtains through effective and efficient management of its resources and operations.

Right-of-Way

The legal right, established by usage or grant, to pass along a specific route through grounds or property belonging to another.