Question

A principal of $2500 is invested at 5% interest, compounded annually. How much will the investment be worth after 7 years?

Answer 1

`\bf ~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+(r)/(n)\right)^(nt) \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\to &\$2500\\ r=rate\to 5\%\to (5)/(100)\to &0.05\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{annually, thus once} \end{array}\to &1\\ t=years\to &7 \end{cases} \\\\\\ A=2500\left(1+(0.05)/(1)\right)^(1\cdot 7)\implies A=2500(1.05)^7\implies A\approx 3517.751057`