Question

Sue now has $125. How much would she have after 8 years if she leaves it invested at 8.5% with annual compounding?

$205.83


$216.67


$228.07


$240.08


$252.08

Answer 1

future value = 240.076 = 240.08

so correct option is $240.08

Step-by-step explanation:

given data

present value = $125

rate = 8.5 % = 0.085

time = 8 year

to find out

future value

solution

we get here future value that is express as

future value = present value ×
`(1+r)^(t)` ...........................1

here r is rate and t is time period

put here value in equation 1

future value = present value ×
`(1+r)^(t)`

future value = $125 ×
`(1+0.085)^(8)`

future value = 240.076 = 240.08

so correct option is $240.08