BUSINESS, FUR1 2002 VCAA 2 MC

An investment of `$16\ 000` is made at `4%` interest per annum, compounding yearly.
The value of the investment at the end of the second year is

A. $17 280.71

B. $17 305.60

C. $17 325.71

D. $21 120.00

E. $21 897.10

Show Answers Only

`B`

Show Worked Solution

`text(Using)\ \ A`	`= PR^n`
`A`	`= 16\ 000 xx (1.04)^2`
	`= $17\ 305.6`

`:.\ text(After 2 years, investment is $17 305.60.)`

`=> B`