5
QuizMultiple Choice

Modeling Investments — Quiz

Question 5 • Advanced Financial Algebra

Which scenario can be modeled using the formula A=P×(1+(r)/(n))^n⁢t ?

Answer
A
500 dollars invested in a 3-year bond earning 5 percent interest compounded annually.
B
A 50 dollars deposit that earns 1 percent simple interest on the principal once annually.
C
500 dollars deposited into a savings account that earns 2 percent simple interest annually.
D
Monthly deposits of 50 dollars into a savings account where interest is added to the total balance annually.
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