Question

Alyson deposits $500 in the bank for 12 years. The bank offers her a 4% interest rate compounded annually. How much money will be in her account at the

end of the 12 years? (Remember to round your answer to the nearest cent.)

Answer 1

$800.516

Explanation:

We use the equation

A = P(1 +
`(r)/(n)`)^nt

P = principal

r = rate of interest

t = times

Now let's solve

P = $500

r = 4% = 0.04

t = 12 years

A = $500(1 +
`(0.04)/(12)` ) ^12 = $800.516