Question

Michelle has $1,393 in a savings account. The interest rate is 9%, compounded annually.

To the nearest cent, how much will she have in 2 years?

$?

Answer 1

A = P (1 + r)^n where P = initial amount, r = interest rate , n = number of years and A = amount after n years.

So here we have A = 1393(1 + 0.09) ^ 2 ( 0.09 = 9%)

= $1655.02 (answer)