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Eliana opened a savings account and deposited $700.00 as principal. The account earns 4%

interest, compounded monthly. What is the balance after 10 years?

User Ragesh
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1 Answer

4 votes

Answer:

We can use the formula for compound interest to find the balance in Eliana's savings account after 10 years:

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

where A is the balance, P is the principal (initial deposit), r is the annual interest rate as a decimal, n is the number of times interest is compounded per year, and t is the time in years.

Substituting the given values, we get:

A = $700(1 + 0.04/12)^(12*10)

Simplifying, we get:

A = $700(1.0033333)^120

Using a calculator, we get:

A ≈ $1,038.81

Therefore, the balance in Eliana's savings account after 10 years is approximately $1,038.81.

User Steev James
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