Question

Question 4

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If 19300 dollars is invested at an interest rate of 9 percent per year, find the value of the investment
at the end of 5 years for the following compounding methods, to the nearest cent.

Answer 1

$296,954.42

Explanation:

If any amount P is invested at rate of r% per year for n years then value of money p after n years is given by

FV = p(1 + r/100)^n

where FV is the future value of money after n years.

given

p= $19300

r = 9%

n = 5 years

Thus, FV = 193000(1 + 9/100)^5

FV = 193000((100 + 9)/100)^5

FV = 193000(109/100)^5

FV = $296,954.42

Thus, value after 5 years for the investment is $296,954.42 to the nearest cent