Question

First try was incorrect Lemon is saving money to buy some vreels. She invests $300 in a savings accountsavings account that earns 5 4/5% interest, compounded annually.

How much money will she have in her account after 5 years? Answer
in dollars and round to the nearest cent.

Answer 1

Lemon will have approximately $386.96 in her savings account after 5 years, by investing $300 at an annual compound interest rate of 5 4/5%.

Step-by-step explanation:

The question involves calculating the future value of an investment with compound interest. To find out how much Lemon will have in her account after 5 years, we use the compound interest formula: A = P(1 + r/n)^(nt), where A is the amount of money accumulated after n years, including interest, P is the principal amount ($300), r is the annual interest rate (5 4/5% or 0.058), n is the number of times that interest is compounded per year (once in this case), and t is the time in years (5).

To calculate the total amount, the calculation would be as follows:

1. First, convert the percentage to a decimal: 5 4/5% = 5.8% = 0.058.
2. Substitute the values into the formula: A = 300(1 + 0.058/1)^(1*5)
3. Solve the expression: A = 300(1.058)^5
4. Calculate the result: A ≈ $386.96 (rounded to the nearest cent).

Therefore, after 5 years, Lemon will have approximately $386.96 in her savings account.