If you leave your money in the bank at a fixed interest rate and allow for compounding of interest, show what will happen to your savings over time. Indicate with a graph whether there is a negative or positive slope between savings and time and what happens to the slope over time.
What will be an ideal response?
Placing time on the horizontal axis (the independent variable) and savings on the vertical axis (the dependent variable), savings will increase at an increasing rate (Figure 1-2). Slope is positive and increasing. For example, $100 saved at 5 percent interest will yield $105 at the end of one year. At the end of the second year, one has $105 + $105(.05) = $110.25. Savings increases by $5.25 in year 2, a greater increase than the $5 increase in year 1.
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Which of the following best describes the Employment Act of 1946?
(a) A piece of New Deal legislation that had to be postponed until after the war (b) An effort to stabilize the U.S. balance of payments as the world moved toward using the U.S. dollar as the main reserve currency (c) An attempt to reduce the overall extent of federal responsibility in the post-war national economy (d) All of the above
Which of the following will always be true when an economy is in long-run equilibrium?
a. The level of prices will be constant (that is, inflation will be zero). b. Actual output will exceed the potential output. c. The actual rate of unemployment will be less than the natural rate of unemployment. d. The output of the economy will correspond with the full-employment output.
The most complicated form of business ownership is the sole proprietorship
Indicate whether the statement is true or false
Other things the same, if prices fell when firms and workers were expecting them to rise, then
a. employment and production would rise. b. employment would rise and production would fall. c. employment would fall and production would rise. d. employment and production would fall.