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13 December, 03:21

You are considering investing in a retirement fund that requires you to deposit $5,000 per year, and you want to know how much the fund will be worth when you retire. What financial technique should you use to calculate this value? (a) Future value of a single payment (b) Future value of an annuity (c) Present value of an annuity (d) Present value of a perpetuity

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  1. 13 December, 07:00
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    The appropriate technique to be applied is future value of annuity. The correct answer is B.

    Explanation:

    Since the deposit will be made at the end of each year and there is need to determine the worth of the fund on retirement, the appropriate technique to employ is future value of annuity.
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