What Is the Future Value of $2000 Deposited for One

question 6

Multiple Choice

What is the future value of $2000 deposited for one year earning 6% interest rate annually?

• A) $120
• B) $2000
• C) $2120
• D) $4120

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Definitions:

Compounded Monthly

The process of adding interest to a principal sum of money, with the interest that is added also earning interest, occurring on a monthly basis.

Insurance Annuity

A financial product offered by insurance companies that provides regular payments to the holder for a specified period or for life in exchange for an initial investment.

Rate Of Return

The percentage of gain or loss on an investment over a specified period, representing the profitability as a ratio of original investment.

Heirs

Individuals legally entitled to receive a portion or all of a deceased person’s estate under the laws of inheritance.