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Harvey recently inherited $260,000. He would like to invest his inheritance and is considering the following investments: (i) $40,000 in a 5-year GIC with an
Harvey recently inherited $260,000. He would like to invest his inheritance and is considering the following investments: (i) $40,000 in a 5-year GIC with an annual interest rate of 2%; (ii) An Oil Growth mutual fund, expected to yield an average annual return of 7% over each of the next 5 years; (iii) A $125,000 5-year security with a stated rate of 5% per year, paying quarterly interest His goal is to have his investments grow to a cumulative value of $350,000 at the end of 5 years. To reach his goal, Harvey's investment in the Oil Growth mutual fund should be: a) $92,367 b) $111,143 c) $108,986 d) $103,798
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