Question

Ivan deposits $2000 into an account that pays simple interest at an annual rate of 4%.He does not make any deposits. He makes no withdrawls until the end of 6 years when he withdraws all the money. What will be the total amount in the account be (including interest)?

Answer 1

Answer: after 6 years, the total amount in the account, including interest, will be $2,480. Ivan will have $2,480 when he withdraws all the money.

Explanation:

To calculate the total amount in the account, including interest, after 6 years, you can use the simple interest formula:

A = P(1 + rt)

Where:

A = the total amount including interest

P = the principal amount (initial deposit)

r = the annual interest rate (as a decimal)

t = the time the money is invested (in years)

In this case:

P = $2,000

r = 4% or 0.04 (as a decimal)

t = 6 years

Now, plug these values into the formula and calculate:

A = 2,000 * (1 + 0.04 * 6)

A = 2,000 * (1 + 0.24)

A = 2,000 * 1.24

A = $2,480

So, after 6 years, the total amount in the account, including interest, will be $2,480. Ivan will have $2,480 when he withdraws all the money.