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30 votes
30 votes
given the principal in a bank at the beginning of the year and a rate of interest that is compounded annually, calculate the amount in the account at the end of the year. $2,000; 2.5% if interest is compounded annually, what is the amount after t = 1 year?

User Rijul
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1 Answer

8 votes
8 votes
Answer:

The amount is $2050

Step-by-step explanation:

Given the following:

Principal, P = $2,000

Rate, r = 2.5%

Time, t = 1 year

Number of times interest is compounded in a year, n = 1

The amount is given as:


\begin{gathered} A=P(1+(r)/(n))^(nt) \\ \\ =2000(1+0.025)^(1*1) \\ \\ =2000(1.025) \\ =2050 \end{gathered}

The amount is $2050

User Jake Wagner
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