The future value of $1,000 deposited a year for 5 years earning 4 percent would be approximately:
A) $5,000
B) $5,250
C) $5,400
D) $6,500
E) $8,200

Question

Quizplus · Accepted Answer

The future value of an annuity can be calculated using the formula FV = P * [(1 + r)^n - 1] / r, where P is the annual payment ($1,000), r is the interest rate (0.04), and n is the number of years (5). Plugging in these values gives approximately $5,416, which is closest to $5,400.

The Future Value of $1,000 Deposited a Year for 5