Question
8. This morning, Louise opened a savings account that will earn 2.2 percent interest, compounded annually. After five years, her savings account will be worth
8. This morning, Louise opened a savings account that will earn 2.2 percent interest, compounded annually. After five years, her savings account will be worth $5,600. Assume Louise will not make any withdrawals or additional deposits. Given this, which one of the following statements is false? Louise deposited less than $5,600 this morning. The present value of Louise's account is less than $5,600. Louise could have deposited less money and still had $5,600 in five years if she could have earned more than 2.2 percent interest. Louise would have had to deposit more money to have $5,600 in five years if she were to earn less than 2.2 percent interest. Louise will earn an equal dollar amount of interest every year for the next five years.
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