Suppose you have $2,000 and plan to purchase a 10-year certificate of deposit (CD)that pays 6.5% interest,compounded annually.How much will you have when the CD matures?
A)$3,754.27
B)$3,941.99
C)$4,139.09
D)$4,346.04
E)$4,563.34

Question

Quizplus · Accepted Answer

The correct answer is A because the future value of the CD can be calculated using the formula: FV = PV * (1 + r)^n, where PV is the present value, r is the annual interest rate, and n is the number of years. Plugging in the given values, we get: FV = 2000 * (1 + 0.065)^10 = $3,754.27.

Suppose You Have $2,000 and Plan to Purchase a 10-Year