Simple and Compound Interest Questions

Multiple choice
  1. $2750$
  2. $3750$
  3. $78,795$
  4. $78,796.87$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The question asks for the compound interest amount but mentions the simple interest method, which is contradictory. Calculating compound interest for 75,000 at 2.5% for 2 years: 75,000 * (1 + 0.025)^2 = 75,000 * 1.050625 = 78,796.875.