113k views
5 votes
The expression 1000(1.15)t represents the value of a $1000 investment that earns 15% interest per year, compounded annually for t years. What is the value of a $1000 investment at the end of 6 years ?

User Raconteur
by
7.6k points

1 Answer

5 votes

Final answer:

The value of a $1000 investment earning 15% compounded annually over 6 years would be $2010.60.

Step-by-step explanation:

The expression 1000(1.15)t represents the value of a $1000 investment that earns 15% interest per year, compounded annually. We are asked to find the value of this investment at the end of 6 years.

To calculate this, we substitute t with 6:
1000(1.15)6
This is equivalent to $1000 multiplied by 1.15 raised to the 6th power. After performing the calculation:

1000 × (1.15)6 = $1000 × 2.0106 = $2010.60

Hence, the value of the $1000 investment at the end of 6 years is $2010.60.

User Vincent Savard
by
8.4k points