Brad Deposited $5,250 into an Account That Earns 7% Interest

question 16

Multiple Choice

Brad deposited $5,250 into an account that earns 7% interest compounded continuously.How much money will he have in 15 years?

• A)$15,002.67
• B)$12,175.90
• C)$13,957.14
• D)$14,964.25

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Definitions:

Trial-And-Error

A method of problem-solving that involves testing various methods of achieving an outcome until a satisfactory solution is found.

Nominal Rate

The interest rate before adjustments for inflation, used in the evaluation and comparison of loans or investments.

Effective Annual Rate

The interest rate on an investment or loan on an annual basis, taking compounding into account, providing a true reflection of financial returns or costs.

Effective Annual Rate

The interest rate on an investment or loan that considers compounding over a specified period, usually yearly.