Question

Kelsey has $100 in an account the interest-rate is 11% compounded annually to the nearest cent how much will she have in two years

Answer 1

$123.21 (nearest cent)

Explanation:

Annual Compound Interest Formula

`\large \text{$ \sf A=P\left(1+r\right)^(t) $}`

where:

• A = final amount
• P = principal amount
• r = interest rate (in decimal form)
• t = time (in years)

Given:

• P = $100
• r = 11% = 0.11
• t = 2 years

Substitute the given values into the formula and solve for A:

`\implies \sf A=100\left(1+0.11\right)^(2)`

`\implies \sf A=100\left(1.11\right)^(2)`

`\implies \sf A=123.21`

Therefore, the value of the account in 2 years will be $123.21 (nearest cent).