Question

$6,300 is deposited into an account that earns 3.5% compound interest, compounded weekly, for 9 years. How much will the account be worth at the end of 9 years?

a) $7,402.82
b) $7,623.17
c) $7,839.68
d) $8,019.56

Answer 1

To calculate the final amount of an account with compound interest, use the formula A = P(1 + r/n)^(nt). Plugging in the given values, the account will be worth $7,402.82 at the end of 9 years.

Step-by-step explanation:

To calculate the amount a bank account will be worth after a certain period of time with compound interest, we can use the formula:

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

Where:

A = the final amount in the account

P = the principal amount (initial deposit)

r = the annual interest rate (in decimal form)

n = the number of times the interest is compounded per year

t = the number of years

In this case, we have:

P = $6,300

r = 3.5% = 0.035

n = 52 (weekly compounding)

t = 9 years

Plugging these values into the formula, we get:

A = $6300(1 + 0.035/5252*9) = $7,402.82

Therefore, the account will be worth $7,402.82 at the end of 9 years.