If You Were to Invest $120 for Two Years,while Earning

question 84

Multiple Choice

If you were to invest $120 for two years,while earning 8% compound interest,what is the TOTAL AMOUNT OF INTEREST that you will earn?

• A) $139.97
• B) $139.20
• C) $19.20
• D) $19.97

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Definitions:

Carrying Amount

The book value of assets and liabilities reported on the balance sheet, calculated as the original cost less any depreciation, amortization, or impairment costs.

Interest-Bearing

Referring to a financial instrument or account that generates interest income over time.

Promissory Note

A financial instrument that represents a written promise by one party to pay a specified sum of money to another party, either on demand or at a predetermined future date.

Account Receivable

Funds that are yet to be received from customers to whom goods or services have been sold on credit.