Question

. You deposit $10,000 in an account that pays 6.92% annual interest. Find the balance after 5 years if the interest is compounded with the given frequency.

Answer 1

$13,973.16

Explanation:

The percent is 6.92%. Make that a decimal, and it's 0.0692. To make it go up instead of down, change it to 1.0692. Now if you multiply a number with 1.0692, the number will grow by 6.92%.

10,000 x 1.0692 = 10,692 (1st year)

10,692 x 1.0692 = 11,431.8864 (2nd year)

11,431.8864 x 1.0692 = 12,222.97293888 (3rd year)

12,222.97293888 x 1.0692 = 13.068.802666250496 (4th year)

13.068.802666250496 x 1.0692 = 13,973.1638107550303232 (5th year)

13,973.1638107550303232 = $13.963.16 (5th year total in $)