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How much would $1, growing at 12.0% per year, be worth after 75 years?

Oa. $4,913.06
Ob. $4,077.84
c. $4,863.93
Od. $4,126.97
Oe. $4,716.53

1 Answer

4 votes

Final answer:

Using the compound interest formula, $1 invested at 12% interest per year would grow to a future value of $4,863.93 after 75 years. The correct option is C.

Step-by-step explanation:

The student's question of 'How much would $1, growing at 12.0% per year, be worth after 75 years?' falls under the subject of compound interest, which is a part of high school mathematics. To calculate the future value of this investment, you would use the formula for compound interest:

Future Value = Present Value x (1 + rate)^number of periods.

In this case, the present value is $1, the annual interest rate, 'r', is 12% or 0.12, and the number of years, 'n', is 75. Plugging these values into the formula yields:

Future Value = 1 x (1 + 0.12)^75

Calculating this value gives us a future value of $4,863.93, using a calculator to compute 1.12 raised to the power of 75 and multiplying the result by $1. Therefore, the correct option from the choices provided is 'c' $4,863.93.

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