Final answer:
To determine the future value of a $2000 investment at 8% interest, compounded annually for 5 years, we use the compound interest formula, resulting in a final value of approximately $2939 after rounding to the nearest dollar.
Step-by-step explanation:
To calculate the future value of an investment with compound interest, the formula A = P(1 + r/n)nt is used, 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, and 't' is the time the money is invested for in years.
In this case, for an initial principal of $2000 invested at an 8% interest rate, compounded annually, over 5 years, the formula becomes:
A = 2000(1 + 0.08/1)1*5
A = 2000(1 + 0.08)5
A = 2000(1.08)5
A = 2000 * 1.46933
A = 2938.66
After rounding to the nearest dollar, the investment will be worth $2939 after 5 years.