3
lesson pretestMultiple Choice

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Question 3 • Financial Math

Alanna places $10,000 in a savings account for 6 years with no interest. Inflation averages 3.5% per year over this period. What will the present value of the $10,000 investment be at the end of the 6 years? Use this formula to calculate the present value while accounting for inflation: present value is equal to the fraction with numerator future value and denominator open paren 1 plus annual inflation rate close paren to the number of years th power

Answer
A
7 dollars comma 500 point 0 0
B
10 dollars comma 000 point 0 0
C
8 dollars comma 135 point 0 1
D
12 dollars comma 292 point 5 5
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