Question

Michael Phelps has deposited $12,000 in a guaranteed investment account with a promised rate of 4% compounded annually. He plans to leave it there for 4 full years when he will make a down payment on a car after graduation. How much of a down payment will he be able to make?

		$10,297.43
		$13,498.37
		$11,826.71
		$10,645.31
		$11,251.98

Answer 1

Amount	12000
Return	4%
Time	4 years
Amount=	12000*(1+4%)^4
Amount=	14038.3
But the options are not correct. I observed if the amount remains invested for 3 years
Amount=	=12000*(1+4%)^3
Amount=	13498.37
then 2nd option matches so accordingly the question might have some mistake