Question

Using the formula in model 1, choose the correct answers for the new balance and the amount of interest earned in the following compound interest problem. $650 at 8% for 14 years, compounded annually.

Total Amount = $
Interest Amount =$

Answer 1

A=p(1+r)^t
A=650×(1+0.08)^(14)
A=1,909.18
Interest earned=a-p=1909.18-650=1,259.18

Answer 2

Total Amount = $ 1,909.18
Interest Amount =$ 1,259.18