At the end of two years, what will be the balance in a savings account paying 6% annually if $5,000 is deposited today? The future value of one at 6% for one period is 1.06.
A)$5,000
B)$5,300
C)$5,600
D)$5,618

Question

Quizplus · Accepted Answer

To calculate the balance after two years, we need to multiply the initial deposit by the future value of one for two periods:
$5,000 x 1.06 x 1.06 = $5,618. Therefore, the correct answer is D.

At the End of Two Years, What Will Be the Balance