If $12,000 is invested for one year at an annual interest rate of 12%, it will grow in value to:
A)$13,440.
B)$14,400.
C)$440.
D)$400.

Question

Quizplus · Accepted Answer

To find the growth in value, we can use the formula for simple interest:

Growth = Principal x Rate x Time

where Principal is the initial amount invested, Rate is the annual interest rate as a decimal, and Time is the duration of the investment in years.

In this case, we have:

Principal = $12,000
Rate = 0.12 (12% expressed as a decimal)
Time = 1 year

So the growth in value is:

Growth = $12,000 x 0.12 x 1 = $1,440

To find the final value of the investment, we need to add this growth to the original principal:

Final Value = Principal + Growth = $12,000 + $1,440 = $13,440

Therefore, the best choice is A) $13,440.

If $12,000 Is Invested for One Year at an Annual