ABC Bank Pays 2% Simple Interest Compounded Annually on an Investment

question 25

Multiple Choice

ABC Bank pays 2% simple interest compounded annually on an investment of $10,000.What is the interest earned in the fifth year?

• A) $2000
• B) $200
• C) $1000
• D) $100
• E) $500

---

Definitions:

Total Costs

The aggregate amount of all expenses associated with the production of a good or the operation of a business.

Larger Firms

Companies or businesses that employ a large number of workers and typically have a substantial volume of business operations and market influence.

Health Insurance

A form of insurance coverage that pays for an individual's or group's medical and surgical expenses or reimburses losses from sickness.

Noncontingent Basis

A situation or condition not dependent on certain events, conditions, or actions in order to occur or be valid.