What is the future value (FV)of $20,000 in four years,assuming the interest rate is 12% per year?
A)$17,096.08
B)$28,292.66
C)$31,470.39
D)$32,020.64

Question

Quizplus · Accepted Answer

Using the formula for future value:

FV = PV x (1 + r)^n

where: 
PV = present value = $20,000 
r = interest rate per year = 12% = 0.12 
n = number of years = 4

Plugging in the values:

FV = $20,000 x (1 + 0.12)^4 
FV = $20,000 x 1.5735 
FV = $31,470.39

Therefore, the future value of $20,000 after four years at an interest rate of 12% is $31,470.39. The best choice is C.

What Is the Future Value (FV)of $20,000 in Four Years,assuming