34
practice examMultiple Choice

Practice Exam

Question 34 • Financial Math

Elisa puts $7,500 into a retirement account with an annual compound interest rate of 6% The bank compounds the interest monthly. How much will Elisa have in the account after ten years? A=P⁢(1+(r)/(n))^n⁢t

Answer
A
21 dollars comma 939 point 4 6
B
13 dollars comma 645 point 4 8
C
8 dollars comma 369 point 7 9
D
2 dollars comma 616 comma 839 point 8 9

Explanation

Use the compound interest formula with P = 7,500, r = 0.06, n = 12, and t = 10. This gives 7,500(1 + 0.06/12)^(12 × 10) = 7,500(1.005)^120 ≈ $13,645.48. Elisa will have about $13,645.48, which is choice D.

AI-written and checked against the verified answer.

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