Determine the Future Value of $150 Made at the End

question 194

Multiple Choice

Determine the future value of $150 made at the end of every quarter for 15 years, given an interest rate of 4.5% compounded monthly.

• A) $12,772.78
• B) $12,904.12
• C) $13,401.86
• D) $13,915.68
• E) $14,202.22

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Definitions:

Forward Rate

An agreed-upon price for a financial transaction that will occur at a future date.

International Fisher Effect

A theory stating that the difference in nominal interest rates between two countries is equal to the expected change in their exchange rates.

Inflation Rate

The pace at which prices for general goods and services escalate, causing a decline in the ability to purchase.

Treasury Bill

Short-term government securities with maturity periods of one year or less, sold at a discount from face value.