Final answer:
The amount of money in the account at the end of 12 years, with an initial investment of $1000 at 8% interest compounded annually, is $2518.17.
Step-by-step explanation:
To calculate the final amount in an account with compound interest, we use the formula A = P(1 + r/n)nt, where:
- A is the amount of money accumulated after n years, including interest.
- P is the principal amount (the initial amount of money).
- r is the annual interest rate (decimal).
- n is the number of times that interest is compounded per year.
- t is the time the money is invested for, in years.
In this case, we have a principal amount of $1000, an annual interest rate of 8% (or 0.08 in decimal form), interest is compounded annually (n = 1), and the time is 12 years. Plugging these values into the formula:
A = 1000(1 + 0.08/1)1(12)
A = 1000(1.08)12
Now calculate A using the formula:
A = 1000(2.5182)
A = $2518.17
The amount of money in the account at the end of 12 years is $2518.17, which corresponds to option D.