Question

Suppose you deposit $2,000 in a savings account that pays interest at an annual rate of 4%. If no money is added or withdrawn, determine how much will be in the account after 18 years.

A) 3 years
B) 4 years
C) 5 years
D) 6 years

Answer 1

To calculate the final amount in the savings account after 18 years, we can use the formula for compound interest. Plugging in the values, the final amount is approximately $3,675.80.

Step-by-step explanation:

To determine how much will be in the savings account after 18 years, we can use the formula for compound interest:

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

Where:

• A is the final amount in the account
• P is the initial deposit amount ($2,000)
• r is the annual interest rate (4% or 0.04)
• n is the number of times interest is compounded per year (assuming it is compounded annually, so n = 1)
• t is the number of years (18 years)

Plugging in the values, we get:

A = 2000(1 + 0.04/1)^(1*18)

Simplifying the equation:

A = 2000(1 + 0.04)^18

A = 2000(1.04)^18

A = 2000 * 1.8379

A ≈ $3,675.80

Therefore, after 18 years, there will be approximately $3,675.80 in the account.

Answer 2

using the formula I = PRT

I = $2000 × 0.04 × 18
I = $1440

$2000 + $1440 = $3440

the choices given are not related to the question in anyway bub, you may have copied it wrongly