One thousand dollars invested today at 5 percent per year, compounded annually, for five years will be worth
A) $1,050
B) $1,250
C) $1,276
D) None of the above

Question

Quizplus · Accepted Answer

The future value of an investment compounded annually is calculated using the formula FV = PV * (1 + r)^n. Here, FV = 1000 * (1 + 0.05)^5 = 1000 * 1.27628 = $1,276.28, which rounds to $1,276.

One Thousand Dollars Invested Today at 5 Percent Per Year