Question

Suppose your​ friend's parents invest $ 10,000 in an account paying 7% compounded annually. What will the balance be after 8 ​years?

Answer 1

- this is a simple interest question, so you should know the formula for this.

simple interest: i = prt

i - interest

p - principle amount (deposit)

r - rate

t - time in years

the problem: -- this is a two step question, since its asking for the balance.

i = prt

i = 10,000(0.07)(8)

i = 5600

- remember this is just the interest, NOT the balance.

to find the balance:

5600 + 10000 = 15600

FINAL ANSWER:

$15,600

-- let me know if you have any questions regarding this.