$200 invested in a savings account paying an annual interest rate of 5 percent will be worth how much at the end of five years,assuming all interest earned remains in the account?

Question

Quizplus · Accepted Answer

Using the simple interest formula, we get:
Interest = Principal x Rate x Time
Interest = $200 x 0.05 x 5
Interest = $50
The total amount in the savings account after 5 years will be:
Total = Principal + Interest
Total = $200 + $50
Total = $250
Therefore, the correct answer is (D) $255.26, assuming the interest is compounded annually.

$200 Invested in a Savings Account Paying an Annual Interest