Question

Chris wants to invest in an account that earns 9% interest, compounded annually. He opens the account with an initial deposit of $200, and deposits an additional $200 into the account each year thereafter. Assuming no withdrawals or other deposits are made and that the interest rate is fixed, the balance of the account (rounded to the nearest dollar) after the tenth deposit is __________.

Answer 1

The balance of the account after the tenth deposit is $563.

Step-by-step explanation:

To find the balance of the account after the tenth deposit, we can use the formula for compound interest.

The formula is:
`A = P(1 + r/n)^(nt),` where A is the balance, P is the principal (initial deposit), r is the interest rate, n is the number of times interest is compounded per year, and t is the number of years.

In this case, the principal is $200, the interest rate is 9% (or 0.09), the number of times interest is compounded per year is 1, and the number of years is 10.

Plugging in these values, we get:

`A = 200(1 + 0.09/1)^(1*10) = 200(1.09)^10`

= $562.68.

Rounded to the nearest dollar, the balance of the account after the tenth deposit is $563.