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Carl put $450 in a savings account at 2.5 percent interest, compounded daily. How much money will he have in a year? Round to the nearest dollar. $452 $443 $461 $405

1 Answer

3 votes

Answer:

(c) $461

Explanation:

You want the balance in an account in which $450 is earning 2.5% interest compounded daily for one year.

Compound interest

The formula for the account balance is ...

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

where principal P is invested at annual rate r for t years, compounded n times per year.

The attachment shows the evaluation of this formula with the given numbers put in.

Carl will have $461 in a year.

Carl put $450 in a savings account at 2.5 percent interest, compounded daily. How-example-1
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