Maxine has $1,000 to invest today. How much will her money be worth in 15 years if she earns 9% compounded semiannually on her money?
A) $3,745
B) $13,268
C) $3,642
D) $1,935

Question

Quizplus · Accepted Answer

The future value of an investment is calculated using the formula FV = P(1 + r/n)^(nt), where P is the principal amount ($1,000), r is the annual interest rate (9% or 0.09), n is the number of times the interest is compounded per year (2 for semiannually), and t is the time the money is invested for (15 years). Plugging in the values, we get FV = $1,000(1 + 0.09/2)^(2*15) = $3,745.

Maxine Has $1,000 to Invest Today