Jane has $3,200 she wants to invest in stocks. She has found an investment that she believes will earn a 9% annual return. What will be the value of Jane's investment in 20 years if she is correct?
A) $17,933
B) $16,512
C) $14,915
D) $21,526

Question

Quizplus · Accepted Answer

The value of Jane's investment can be calculated using the formula for compound interest: A = P(1 + r)^n, where A is the amount of money accumulated after n years, including interest, P is the principal amount ($3,200), r is the annual interest rate (9% or 0.09), and n is the time the money is invested for (20 years). Plugging in the values: A = $3,200(1 + 0.09)^20 = $17,933 (rounded to the nearest dollar).

Jane Has $3,200 She Wants to Invest in Stocks