If you put $300 into an account paying 2 percent interest,what will be the value of this account in two years?
A)$310
B)$312
C)$312.12
D)$314.24

Question

Quizplus · Accepted Answer

To calculate the value of the account after two years, we need to use the formula:
A = P (1 + r/n)^(nt)
Where:
A = Final amount
P = Initial amount (principal)
r = Annual interest rate (as a decimal)
n = Number of times the interest is compounded per year
t = Number of years
In this case,
P = $300, r = 0.02, n = 1 (compounded annually), and t = 2
Plugging in the values, we get:
A = 300 (1 + 0.02/1)^(1*2)
A = $312.12
Therefore, the best choice is C, with the final value of the account being $312.12 after two years.

If You Put $300 into an Account Paying 2 Percent