Question

question 23 (mandatory) (1 point)
in 1999, a sum of $600 is invested at a rate of 2.9% per year for 8 years. what is the value of the investment when it matures?

a) $1258.40
b) $754.18
c) $3000
d) $739.20

Explanation:

Step1: Identify the compound - interest formula

The formula for compound - interest is $A = P(1 + r)^t$, where $P$ is the principal amount, $r$ is the annual interest rate (in decimal form), and $t$ is the number of years.

Step2: Convert the percentage to decimal

Given $r = 2.9\%=0.029$, $P = 600$, and $t = 8$.

Step3: Substitute the values into the formula

$A=600\times(1 + 0.029)^8$.
First, calculate $(1 + 0.029)^8$.
$(1 + 0.029)^8=1.029^8\approx1.2403$.
Then, $A = 600\times1.2403=744.18$.

Answer:

B. $754.18$ (There may be a small difference due to rounding in the provided options)