If $16,000 is invested at 10% for 20 years, find the future value if the interest is compounded daily.
A) $118,205.20
B) $117,637.20
C) $118,192.52
D) $118,126.47
E) $117,930.19

Question

Quizplus · Accepted Answer

The formula for calculating the future value of an investment with daily compounding is $A = P\left(1+\frac{r}{n}\right)^{nt}$, where $A$ is the future value, $P$ is the principal, $r$ is the annual interest rate, $n$ is the number of times the interest is compounded per year, and $t$ is the time in years. Plugging in the given values, we get:

$A = 16000\left(1+\frac{0.1}{365}\right)^{(365)(20)}$

$A \approx 118,192.52$

Therefore, the correct answer is choice (C).

If $16,000 Is Invested at 10% for 20 Years, Find