Question

If 2000 dollars is invested in a bank account at an interest

rate of 10 per cent per year, Find the amount in the bank after 11
years if interest is compounded annually: What is the amount in the
bank?

Answer 1

To find the amount in the bank after 11 years with a yearly interest rate of 10% compounded annually, we use the compound interest formula. Plugging in the given values, the amount in the bank is approximately $5,830.74.

Step-by-step explanation:

To find the amount in the bank after 11 years with a yearly interest rate of 10% compounded annually, we can use the formula for compound interest:

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

Where:

• A is the final amount
• P is the principal amount (initial investment)
• r is the yearly interest rate (in decimal form)
• n is the number of times interest is compounded per year
• t is the number of years

In this scenario, P = $2000, r = 0.1, n = 1, and t = 11. Plugging these values into the formula, we have:

A = 2000(1+0.1/1)^(1*11)

Simplifying the expression, we get:

A = 2000(1.1)^11

Using a calculator, we find that A is approximately $5,830.74. So the amount in the bank after 11 years with a yearly interest rate of 10% compounded annually is $5,830.74.