If the Interest Rate Is 10%, at the End of Two

question 32

Multiple Choice

If the interest rate is 10%, at the end of two years the value of $100 invested now is

• A)$100/1.1
• B)$100/1.1²
• C)$120
• D)$121

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Definitions:

Interest

Interest is the charge for borrowing money, typically expressed as an annual percentage rate of the principal.

Compounded Monthly

The method of accruing interest on the initial amount of a loan or deposit, thereby earning interest on the accrued interest, on a monthly basis.

12%

A numerical value representing twelve parts per hundred, often used to denote a percentage rate, such as an interest rate or growth rate.

7 Years

A time period of seven years, often used in the context of loans, investments, or tenure.