Question

William invested $5000 in an account that earns 3.5% interest, compounded

annually. The formula for compound interest is A(t) = P(1 + 1!
How much did William have in the account after 4 years?
O
O
O
O
A. $16,607,53
B. $5737.62
C. $5700
D. $5070.37
SUBM

Answer 1

Option B. $5737.62

Explanation:

we know that

The compound interest formula is equal to

`A=P(1+(r)/(n))^(nt)`

where

A is the Final Investment Value

P is the Principal amount of money to be invested

r is the rate of interest in decimal

t is Number of Time Periods

n is the number of times interest is compounded per year

in this problem we have

`t=4\ years\\ P=\$5,000\\ r=0.035\\n=1`

substitute

`A=\$5,000(1+(0.035)/(1))^(1*4)`

`A=\$5,000(1.035)^(4)`

`A=\$5,737.62`