Question

Eliza wants to make $10,000 from her investments. She finds an investment account that earns 4.5% interest. She decides to deposit $2,500 into an account. How much money will be in her account after 14 years?

Answer 1

Eliza will have in her $4,075 account after 14 years.

Answer 2

She will have $4,075 in her account after 14 years.

Explanation:

This is a simple interest problem.

The simple interest formula is given by:

`E = P*I*t`

In which E are the earnings, P is the principal(the initial amount of money), I is the interest rate(yearly, as a decimal) and t is the time.

After t years, the total amount of money is:

`T = E + P`.

In this problem:

`P = 2500, I = 0.045, t = 14`

So

`E = P*I*t`

`E = 2500*0.045*14`

`E = 1575`

Total

`T = 2500 + 1575 = 4075`.

She will have $4,075 in her account after 14 years.