Question

How much would $200 invested at 7% interest compounded annually be worth after 5 years? Round your answer to the nearest cent. Do not include units in your answer

Answer 1

Compounded amount after 5 years (A) = $280.51

Explanation:

Given: P = $200, r = 7% = 7/100 = 0.07, n = 5 years

Compounded amount after 5 years (A) = P(1 +r)^n

Now plug in the given values in the above formula, we get

A = 200(1 + 0.07)^5

A = 200*(1.07)^5

A = 200 *1.4025517307

A = $280.51

Compounded amount after 5 years (A) = $280.51

Hope this will helpful.

Thank you.

Answer 2

The future worth (F) of the investment at present (P) with a compound interest i after n years is calculated through the equation,
F = P x (1 + i)^n
Substituting the known values,
F = ($200) x (1 + 0.07)^5 = $280.51
Thus, the future worth of the investment is approximately $280.51.