Question

suppose you have $550 to invest in an account that earns 14% each year how much money will you have after two years round to the nearest penny

Answer 1

The formula for the simple interest is as follows

`A=P(1+rt)`

Thus, substitute the values of the following

`\begin{gathered} P=550 \\ r=0.14 \\ t=2 \end{gathered}`

where P is the principal amount, r is the interest rate in decimals, and t is the time in years.

`A=550\lbrack1+0.14(2)\rbrack`

Multiply 0.14 and 2.

`A=550(1+0.28)`

Add 1 and 0.28.

`A=550(1.28)`

Multiply.

`A=704`

Thus, it'll amount to $704 in 2 years.