Question 1
$\$ 10,000$ is invested for 6 years at an annual simple interest rate of $16 \%$.
a) How much interest will be earned?
b) What is the future value of the investment at the end of the 6 years?

Answer

Expert–verified

Hide Steps

Answer

Calculate the future value: Future Value = Principal + Interest = $10000 + 9600$ = $\boxed{19600}$

Steps

Step 1 ：Calculate the interest: Interest = Principal * Rate * Time = $10000 * 0.16 * 6$ = $9600$

Step 2 ：Calculate the future value: Future Value = Principal + Interest = $10000 + 9600$ = $\boxed{19600}$