# Answer to Question #89098 in Financial Math for Nic

Question #89098

To be able to go on a trip to South America, Keiko decides to save for 4 years. She opens a savings account with $200. The account pays simple interest at an annual rate of 2%. She doesn't make any more deposits.

Answer the following questions. If necessary, refer to the list of financial formulas.

Answer the following questions. If necessary, refer to the list of financial formulas.

Expert's answer

If Keiko decides to save for 4 years, and opens a savings account with $200 which pays simple interest at an annual rate of 2%, then the future value after 4 years is:

FV = 200×(1 + 0.02×4) = $216.

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