You decide to make an investment on a bond that pays 5% interest on the principal only. Which of the following describes how interest accrues on this investment?

All of these answers.

Compound interest.

Incepted interest.

Simple interest.

You purchase two annuities. The first is for three years and pays $1500 annually. The second is for four years and pays $2000 annually. The interest rate for both is 4%. What is the Future Value of this portfolio?

$13,175.33

$485.11

$12,612.90

$506.74