Question

Question 5

An investment of $45 earns 20% interest compounded annually for 3 years. How much is to worth?
O $90.90
O $77.76
O $9.83
O $113.73

Answer 1

$77.76

Explanation:

The future value formula is useful:

FV = P(1 +r)^t

FV = $45(1.20^3) = $45·1.728 = $77.76