Solve the problem.
-An initial investment of $1000 is appreciated for 4 years in an account that earns 4% interest, compounded annually. Find the amount of money in the account at the end of the period.
A)$1216.65
B)$169.86
C)$1169.86
D)$1124.86

Question

Quizplus · Accepted Answer

The amount of money in the account at the end of the period can be found using the formula for compound interest: A = P(1 + r/n)^(nt), where A is the amount of money accumulated after n years, including interest, P is the principal amount (the initial amount of money), r is the annual interest rate (decimal), n is the number of times that interest is compounded per year, and t is the time the money is invested for in years. Plugging in the given values: A = 1000(1 + 0.04/1)^(1*4) = 1000(1.04)^4 = $1169.86.

Solve the Problem. -An Initial Investment of $1000 Is Appreciated for 4 Years