This Afternoon, You Deposited $1,000 into a Retirement Savings Account

Multiple Choice

This afternoon, you deposited $1,000 into a retirement savings account. The account will compound interest at 6 percent annually. You will not withdraw any principal or interest until you retire in 40 years. Which one of the following statements is correct?

A) The interest you earn in Year 6 will equal the interest you earn in Year 10.
B) The interest amount you earn will double in value every year.
C) The total amount of interest you will earn will equal $1,000 × .06 × 40.
D) The present value of this investment is equal to $1,000.
E) The future value of this amount is equal to $1,000 × (1 + 40) .⁰⁶.