You Believe in the Power of Compounding and Decide to Save

question 10

Multiple Choice

You believe in the power of compounding and decide to save $1 per day by avoiding the purchase of a soda.You deposit the $1 at the end of each day in a bank account that pays 8% interest compounded daily.You are going to take a trip in 20 years with the money you have accumulated.How much money will you have in 20 years,assuming 365 days per year?

• A) $7,500
• B) $12,438
• C) $18,032
• D) $22,456