If $10,000 is put in a savings account paying interest of 4% compounded annually, what amount will be in the account at the end of 5 years?
A) $8,220
B) $12,000
C) $12,155
D) $12,167

Question

Quizplus · Accepted Answer

The formula for compound interest is $ A = P(1 + r/n)^{nt} $. Here, $ P = 10,000 $, $ r = 0.04 $, $ n = 1 $, and $ t = 5 $. Plugging in these values, $ A = 10,000(1 + 0.04/1)^{1 \times 5} = 10,000(1.04)^5 = 12,167. $

If $10,000 Is Put in a Savings Account Paying Interest