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Suppose that $6500 is placed in an account that pays 3% interest compounded each year.Assume that no withdrawals are made from the account.Follow the instructions below. Do not do any rounding.

Suppose that $6500 is placed in an account that pays 3% interest compounded each year-example-1
User Malchesador
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1 Answer

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26 votes

Given

Part A


\begin{gathered} P=\text{ \$6,500} \\ r=3\text{ \%} \\ t=1 \end{gathered}

Formula


A=P(1+(r)/(n))^(nt)
\begin{gathered} A=6,500(1+(0.03)/(1))^(1*1) \\ \\ A=6,500(1.03) \\ A=\text{ \$}6,695 \end{gathered}

Part B


\begin{gathered} A=P(1+(r)/(n))^(nt) \\ \\ P=6500 \\ R=3\text{ \%} \\ t=2 \end{gathered}
\begin{gathered} A=6500(1+(0.03)/(1))^(1*2) \\ \\ A=6500(1.03)^2 \\ A=6500(1.0609) \\ A=\text{ \$}6895.85 \end{gathered}

The final answer

Suppose that $6500 is placed in an account that pays 3% interest compounded each year-example-1
User Julien Nioche
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