Question

Use the formula B = p(1.08)n to find the balance B (in dollars and cents) for a principal p invested at a compound interest rate of 8% for n years. $50 invested for 5 years a. $83.67 c. $67.34 b. $101.24 d. $73.47

Answer 1

Option D.
`\$73.47`

Explanation:

In this problem

we have

`B=P(1+r)^(t)`

where

B is the Final Investment Value or a Balance

P is the Principal amount of money to be invested

r is the rate of interest in decimal

t is Number of Time Periods

in this problem we have

`t=5\ years\\ P=\$50\\ r=0.08`

substitute in the formula above

`B=\$50(1+0.08)^(5)=\$73.47`