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Steptoe's bank account has a floating interest rate on certain deposits (the interest rate is adjusted every year). That is, every year the interest rate is adjusted. Four years ago, Steptoe deposited $35,000 into the bank account, when interest rates were 6 percent. The following year, the rate was 6.5 percent; last year, the rate was 8 percent; and this year, the rate fell to 7.5 percent. How much will be in Steptoe's account at the end of the year? Assume annual compounding.
This document contains various important questions and their appropriate answers in the subject field of Economics.
Economics is the study of the principles governing the allocation of scarce means among competing ends when the objective of the allocation is to maximize the attainment of the ends.
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