Question

How much would $200 invested at 6% interest compounded annually be worth after 5 years? Round your answer to the nearest cent.

Answer 1

A=
`p(1+r/100)^(t)`
A=200(1+0.06
`)^(5)`
A=267.65

Answer 2

To determine the future worth (F) of money invested at present with interest (i) that is compounded annually, the formula is,

F = P x (1 + i)^n

where P is the present value of money. Substituting the known values,

F = ($200) x (1 + 0.06)^5 = $267.645

Thus, the future worth of money is approximately $267.65.