The value of $60 deposited in a bank for six years at a rate of 10% compounded annually is:
A) $96.63
B) $96.36
C) $106.29
D) $106.03
E) None of these

Question

Quizplus · Accepted Answer

The value of $60 deposited in a bank for six years at a rate of 10% compounded annually is $106.29. This is because the amount of money in the account after one year is $60 * (1 + 0.10) = $66.00. After two years, the amount of money in the account is $66.00 * (1 + 0.10) = $72.60. After three years, the amount of money in the account is $72.60 * (1 + 0.10) = $79.86. After four years, the amount of money in the account is $79.86 * (1 + 0.10) = $87.84. After five years, the amount of money in the account is $87.84 * (1 + 0.10) = $96.63. After six years, the amount of money in the account is $96.63 * (1 + 0.10) = $106.29.

The Value of $60 Deposited in a Bank for Six