You invest $1000 for 3 years in a fund earning j₁ = 6% in the first year,j₂ = x% in the second year,and j₄ = 8% in the third year.If the accumulated value is $1264.98 after three years,what is the value of x?

Question

Quizplus · Accepted Answer

The correct answer is A because the accumulated value after three years is $1264.98, which means the interest earned in the second year is $1264.98 - $1000 * (1 + 0.06) = $100 * x. Therefore, x = 10%.

You Invest $1000 for 3 Years in a Fund Earning