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Caleb Has Just Graduated from College

Question 48

Multiple Choice

Caleb has just graduated from college. He is used to living on a small budget, so when he gets his first salaried position, he is able to set aside a good chunk of money for savings and investments. Which statement is TRUE regarding how he can use compounded returns to accumulate wealth?


A) He will accumulate more wealth if he starts investing early.
B) He will accumulate a similar level of wealth whether he invests for 35 or 45 years.
C) He will accumulate more wealth if he puts the minimum amount, rather than the maximum amount, into an IRA.
D) In order to see the best wealth accumulation, he must invest at least half his salary.
E) He will accumulate more wealth if he starts investing early and then discontinues his investment than he will see if he continuously invests.

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