Christopher invests $400 today at a 4% rate of return which is compounded annually. What is the future value of this investment after four years?

Question

Quizplus · Accepted Answer

The future value of an investment compounded annually is calculated using the formula FV = P(1 + r)^n, where P is the principal amount, r is the annual interest rate, and n is the number of years. Here, FV = $400(1 + 0.04)^4 = $400(1.16985856) ≈ $468.

Christopher Invests $400 Today at a 4% Rate of Return