Q:

An investment of 75,000 increases at a rate 12.5% per year. Find the value of the investment after 30 years. A. $2,568,248B. $1,438,883C. $256,825D. $243,549

Accepted Solution

A:
For this case we have an equation of the form:
 y = A * (b) ^ t
 Where,
 A: initial amount
 b: growth rate
 t: time
 Substituting values we have:
 y = 75000 * (1.125) ^ t
 For 30 years we have:
 y = 75000 * (1,125) ^ 30
 y = 2568247.871
 Rounding:
 y = 2568248
 Answer:
 the value of the investment after 30 years is:
 A. $ 2,568,248