What Is the Formula You Should Use to Determine a Bank

question 202

Multiple Choice

What is the formula you should use to determine a bank account's future value in 1 year?

• A) Future value equals the present value plus the rate of interest.
• B) Future value equals the present value minus the rate of interest.
• C) Future value equals the present value multiplied by one plus the rate of interest in decimals.
• D) Future value equals the present value divided by one plus the rate of interest in decimals.

---

Definitions:

Noncurrent Assets

Long-term assets not expected to be liquidated or turned into cash within one year, such as property, plant, and equipment.

Unrealized Gains

Increases in value of assets that have not been sold yet, and therefore, the gains are not reflected in the financial statements as actual income.

Trading Securities

Securities that management intends to actively trade for profit.

Trading Securities

Financial assets such as stocks or bonds, purchased with the intention of selling them in the short term to profit from price fluctuations.