Question

find the missing final amount (feature value) and interest earned. (round to the nearest cent as needed)

Answer 1

Final Amount = $32257.45

Compound Interest = $24657.45

Step-by-step explanation

We want to find the missing figures.

To do that, we have to first find the Final Amount on the Principal given with the respective rate and time, and then find the Compound Interest.

We have that for a compound interest:

`A=P(1+r)^t`

where P = principal = $7600

r = rate = 5 1/2% = 5.5% = 0.055

t = time = 27 years

Therefore, the final amount is:

`\begin{gathered} A=7600(1+0.055)^(27)=7600(1.055)^(27) \\ A\text{ = \$32,257.45} \end{gathered}`

To find the Compound Interest, we have to subtract the principal from the final amount.

That is:

I = A - P

I = 32257.45 - 7600

I = $24,657.45