Question

If the APY of a savings account is 4.7%, and if the principal in the savings account is $4500 for an entire year, what will be the balance of the savings account after all the interest is paid for the year?

Answer 1

total = principal * (1 + rate)^1
total = 4,500 * 1.047
total = 4,711.50

Answer 2

$4,711.50

Explanation:

If the APY of a savings account = 4.7%

Principal amount = $4500

time = 1 year

We use the formula of simple interest

A = P ( 1+rt )

Where, A = maturity amount

P = Principal amount ( 4500 )

r = Rate of interest 4.7/100 or ( 0.047 )

t = one year ( 1 )

A = 4500 ( 1 + 0.047 × 1 )

A = 4500 ( 1.047 )

A = $4,711.50

The balance of the savings account is $4,711.50 after all the interest is paid for the year