Question

Your grandmother invested $1,000 in a diversified portfolio 50 years ago. That portfolio earned a compound annual return of 5%. How much is your grandmother’s portfolio worth today, exactly 50 years later? (Round to the nearest cent)

Answer 1

A=P(1+r/100)^n
where
A=future value
P=present value
r=rate of interest
n=time period.

A = $ 1,000 * ( 1+ 5/100) ^ 50

= $ 11,467.39979

Hence the correct answer is $ 11,467.40