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Alma deposits $3,750 into an account that accrues 5.1%, compounded annually. What will her balance be after 6 years?

User Dbz
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1 Answer

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To calculate the balance of an account that accrues interest at a certain rate, compounded annually, you can use the formula:

A = P(1 + r)^t

where:

A = the final balance (what you're trying to find)

P = the initial deposit (the principal)

r = the annual interest rate (expressed as a decimal)

t = the number of years the money is invested for

So in this case:

A = 3750(1 + 0.051)^6

A = 3750(1.051)^6

By using calculator or formula A=P(1+r)^t we can find the final balance after 6 years is $6,068.55

User Jose Kj
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