Question

You invest $200 in a savings account paying an annual interest rate of 6 percent. How much will your investment be worth at the end of five years, assuming all interest earned remains in the account?

O $231.85
O 1,200.00
O $267.65
O $206.00

Answer 1

To calculate the value of your investment at the end of five years, you can use the formula for compound interest: A = P(1 + r/n)^(nt). Plugging in the given values, the investment will be worth $267.65 at the end of five years.

option c is the correct

Step-by-step explanation:

To calculate the value of your investment at the end of five years, you can use the formula for compound interest:

A = P(1 + r/n)^(nt)

where:

• A is the final amount
• P is the principal amount (initial investment)
• r is the annual interest rate (in decimal form)
• n is the number of times interest is compounded per year
• t is the number of years

In this case, you would plug in the values:

• P = $200
• r = 6% = 0.06
• n = 1 (compounded annually)
• t = 5 years

Plugging these values into the formula:

A = $200(1 + 0.06/1)^(1*5)

Simplifying the equation:

A = $200(1 + 0.06)^5

Calculating:

A = $200(1.06)^5

A = $200(1.3382)

A = $267.65

Therefore, your investment will be worth $267.65 at the end of five years.