ECONOMICS
COMPOUND INTEREST
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

An employee put $5, 000.00 in a retirement account that offers 9% interest compounded annually. The employee makes no additional deposits or withdrawals. Which amount is closest to the interest the employee will have earned at the end of 5 years?

$ 229.09


$450.00


$ 2, 250.00


$ 2, 693.12

Explanation:
Detailed explanation1: The rate of compound interest was 9% annually. Thus, the amount $2693.12 is closest to the interest the employee will have earned at the end of 5 years. Thus, Option D: $2693.12 is correct.
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