What will $5000 invested at 10 per cent today accumulate to at the end of five years?

Question

Quizplus · Accepted Answer

We can use the compound interest formula to calculate the final amount:

A = P(1 + r/n)^(nt)

where A is the final amount, P is the principal (initial 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 number of years.

In this case, P = $5000, r = 0.10, n = 1 (compounded annually), and t = 5.

A = 5000(1 + 0.10/1)^(1*5)
  = 5000(1.10)^5
  = $8055.06

Therefore, the best choice is C: $8055.

What Will $5000 Invested at 10 Per Cent Today Accumulate