At an annual interest rate of 8% compounded annually, $5,300 will accumulate to a total of $7,210.65 in 5 years.
Calculation: $7,210.65/$5,300 = 1.3605. This is the future value of 1 factor for 4 periods, 8%.

Question

Quizplus · Accepted Answer

The calculation provided is incorrect. The future value of $5,300 at an 8% annual interest rate compounded annually for 5 years is calculated as $5,300 * (1 + 0.08)^5, which equals approximately $7,793.48, not $7,210.65.

At an Annual Interest Rate of 8% Compounded Annually, $5,300