If You Deposit $1,000 in an Account That Compounds Quarterly

question 9

Multiple Choice

If you deposit $1,000 in an account that compounds quarterly at 8 percent interest, the amount of your account at the end of 5 years will be

• A) $1,104.10.
• B) $1,485.90.
• C) $1,469.30.
• D) $4,661.00.

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Definitions:

Liabilities

Financial obligations or debts that a company or an individual owes to others.

Asset

An asset is a resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide future benefit.

Owner's Equity

The residual interest in the assets of an entity after deducting liabilities, representing the ownership stake of the business owners.

Income Statement

A financial statement that shows a company's revenues and expenses over a specified period, leading to its net profit or loss.