If the interest rate is 5%, what is the future value of $500 in one year?
A)$525
B)$530
C)$598
D)$476

Name: If the interest rate is 5%, what is the future value of $500 in one year? A)$525 B)$530 C)$598 D)$476
Brand: Quizplus
Rating: 4.9 (49 reviews)

Question

Quizplus · Accepted Answer

The future value (FV) of an investment is calculated using the formula FV = PV(1 + r)^n, where PV is the present value, r is the interest rate, and n is the number of periods. Here, PV = $500, r = 5% or 0.05, and n = 1 year. Thus, FV = $500(1 + 0.05)^1 = $500(1.05) = $525.

If the Interest Rate Is 5%, What Is the Future