How much interest will be earned in the next year on an investment paying 12 percent compounded annually if $100 was just credited to the account for interest?
A)$88
B)$100
C)$112
D)$200 The investment will again pay $100 plus interest on the previous interest:

Question

Quizplus · Accepted Answer

The interest earned will be 12% of the new principal, which is $100 (previous interest) + $1000 (original principal), totaling $112.

How Much Interest Will Be Earned in the Next Year