Which of the following is the correct way to compute the future value of $X that earns r percent interest for N years? A)$X(1 + rN)^N B)$X(1 + r)^N C)$X(1 + rN) D)$X(1 + r/N)N

Question

Quizplus · Accepted Answer

The correct formula for calculating the future value of X with interest rate r for N years is:

X(1 + r)^N

Option B is the only choice that matches this formula, with (1 + r) raised to the power of N. Option A has rN without parentheses, which would lead to incorrect results, and options C and D are not the correct formulas for future value with compound interest. Therefore, the best choice is B.

Which of the Following Is the Correct Way to Compute