Answer:
To calculate the amount of interest Perry will earn in 4 years, we can use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A is the final amount (including principal and interest)
P is the principal amount (initial investment)
r is the annual interest rate (expressed as a decimal)
n is the number of times that interest is compounded per year
t is the number of years
In this case, Perry has $6,552 as the principal amount, an interest rate of 14.3% (0.143 as a decimal), and the interest is compounded annually (n = 1). We need to calculate A - P to find out how much interest he will earn.
A = $6,552(1 + 0.143/1)^(1*4)
A = $6,552(1 + 0.143)^4
A = $6,552(1.143)^4
A ≈ $9,965.34
To find out how much interest Perry will earn, we subtract the principal amount from the final amount:
Interest = A - P
Interest = $9,965.34 - $6,552
Interest ≈ $3,413.34
Therefore, Perry will earn approximately $3,413.34 in interest over 4 years.
Explanation: