Answer:
$688.07
Explanation:
To find the answer, we can use the Future Value of an Investment formula:
FV = PV(1 + i)^n
Where:
FV = Future value
PV = Present value
i = interest rate
n = number of compounding periods.
Now, we replace the amounts into the formula to find the value of that the $750 had a year ago.
$750 = PV(1 + 0.09)^1
$750 = PV(1.09)
$750 / 1.09 = PV
$750 / 1.09 = $688.07
We can see that $750 is the value that $688.07 will have in one year, under a 9% interest rate. For that reason, the correct answer is A).
