Final answer:
To calculate the future value of $100 at a 6% interest rate compounded annually for four years, the formula Future Value = Present Value × (1 + interest rate)^number of periods is used, yielding a future value close to $126.
Therefore, the closest future value from the options is $126 (Option C).
Step-by-step explanation:
The question involves calculating the future value of $100 when it is invested at a 6 percent interest rate for four years. To find the future value with compound interest, we use the formula:
Future Value = Present Value × (1 + interest rate)^number of periods
In this case:
So, the calculation will be:
Future Value = $100 × (1 + 0.06)^4
Future Value = $100 × (1.06)^4
Future Value = $100 × 1.2625
Future Value = $126.25
Therefore, the closest future value from the options is $126 (Option C).