Question

An investment of $65,000 is

increasing at a rate of 3.2% per
year. This investment continues at
this rate for 8 years. Write a
function to model this situation.
Find the value of the investment
after 8 years.

Answer 1

We use the compound interest formula

1- 65,000 is our initial investment, we will multiply this by our interest rate(decimals)

2- as it is increasing our interest rate in decimals will be 1.032

3-as 8 is the number of years we will make it 1.032^8

4- we will multiply our initial investment by this= 65,000 x 1.032^8