Which of the following dynamics of investing / creating wealth is TRUE?

1. How much money would you have to invest today, at an interest rate of 5% in order to reach your goal of $1,000,000 in 30 years? Assume no additional money is invested.

Choose One • 20 points

• $123,737.45
• $321,377.45
• $231,377.45
• $132,733.45

2. What annual investment amount must be invested every year in order to reach a goal of $1,000,000 in 30 years at an interest rate of 5%? (assume no upfront investment PV=0)

Choose One • 20 points

• $15,051.44
• $231,377.45
• $1,000,000
• $33,333.33

3. The two bank websites I researched showed that their annual savings account interest rates are ______.  This is because _____.

Choose One • 15 points

• high…they are risky investments
• low…they are nearly risk-free
• low…the government (specifically Congress) keeps them low
• high…the supply of ATM machines is too low

4. What one-time investment amount must be invested today, at a higher interest rate of 7.17% in order to reach a goal of $1,000,000 in 30 years?

Choose One • 20 points

• $1,000,000
• $71,700
• $152,257.13
• $125,257.31

5. The interest rates on savings accounts is ____ the interest rate (rate of return) on riskier investments such as stocks & stock funds.

Choose One • 3 points

• the same as  (they are determined by central bank)
• lower than
• higher than

6. Savings account interest rates at the bank are products just like groceries are at the grocery store.   Just as we make economic decisions with our food buys…

Choose One • 2 points

1. How much money would you have to invest today, at an interest rate of 5% in order to reach your goal of $1,000,000 in 30 years? Assume no additional money is invested.

Choose One • 20 points

• $123,737.45
• $321,377.45
• $231,377.45
• $132,733.45

2. What annual investment amount must be invested every year in order to reach a goal of $1,000,000 in 30 years at an interest rate of 5%? (assume no upfront investment PV=0)

Choose One • 20 points

• $15,051.44
• $231,377.45
• $1,000,000
• $33,333.33

3. The two bank websites I researched showed that their annual savings account interest rates are ______.  This is because _____.

Choose One • 15 points

• high…they are risky investments
• low…they are nearly risk-free
• low…the government (specifically Congress) keeps them low
• high…the supply of ATM machines is too low

4. What one-time investment amount must be invested today, at a higher interest rate of 7.17% in order to reach a goal of $1,000,000 in 30 years?

Choose One • 20 points

• $1,000,000
• $71,700
• $152,257.13
• $125,257.31

5. The interest rates on savings accounts is ____ the interest rate (rate of return) on riskier investments such as stocks & stock funds.

Choose One • 3 points

• the same as  (they are determined by central bank)
• lower than
• higher than

6. Savings account interest rates at the bank are products just like groceries are at the grocery store.   Just as we make economic decisions with our food buys…

Choose One • 2 points