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You deposit $6000 in a savings account that earns 11% interest compounded daily, What is the balance after 4 years?

User Jkebinger
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1 Answer

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To calculate the balance after 4 years, we can use the formula for compound interest:

A = P * (1 + r/n)^(n*t)

where:
A is the balance after t years
P is the principal amount (the initial deposit)
r is the annual interest rate (as a decimal)
n is the number of times the interest is compounded per year
t is the time in years

In this problem, we have:
P = $6000
r = 11% = 0.11
n = 365 (daily compounding)
t = 4 years

Let's plug in the values and solve for A:

A = 6000 * (1 + 0.11/365)^(365*4)
A = $10,874.36 (rounded to two decimal places)

Therefore, the balance after 4 years is approximately $10,874.36.
User Hello
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