Grandmother Smith has just put $12,000 into an investment earning 6 percent a year for her granddaughter's college education.Approximately how much will be in the account in ten years assuming all the interest is left in the account?
A)$19,200
B)$21,490
C)$16,320
D)$21,259

Question

Quizplus · Accepted Answer

To calculate the amount of interest earned after 10 years, we use the formula: 
Interest = Principal x Rate x Time 
where Principal = $12,000, Rate = 6% = 0.06, and Time = 10 years. 
So, Interest = $12,000 x 0.06 x 10 = $7,200. 
Adding this interest to the principal, we get the total amount in the account after 10 years: 
Total = $12,000 + $7,200 = $19,200. 
Therefore, the best choice is B, which matches the calculated total amount in the account after 10 years.

Grandmother Smith Has Just Put $12,000 into an Investment Earning