If Alice Godfried invests $14,000 today at a rate of 4% compounding yearly, what will the value of the investment be in 8 years?

Question

Quizplus · Accepted Answer

To solve this problem, we use the formula for compound interest: A = P(1+r/n)^(nt), where A is the final amount, P is the principal (starting amount), r is the annual interest rate (as a decimal), n is the number of times the interest is compounded per year, and t is the time (in years). Plugging in the values, we get:

A = 14000(1+0.04/1)^(1*8)
A = 14000(1.04)^8
A = $19,166.07

Therefore, the value of the investment will be $19,166 after 8 years. The best choice is C.

If Alice Godfried Invests $14,000 Today at a Rate of 4