Question

$1,500 are deposited into an account with a 7% interest rate,compounded annually.

Find the accumulated amount after 6 years.

Hint: A= P (1+r/k)kt

Answer 1

$2251.10

Explanation:

Principal/Initial Value: P = $1500

Annual Interest Rate: r = 7% = 0.07

Compound Frequency: k = 1 (year)

Period of Time: t = 6 (years)

`\displaystyle A=P\biggr(1+(r)/(k)\biggr)^(kt)\\\\A=1500\biggr(1+(0.07)/(1)\biggr)^(1(6))\\\\A=1500(1.07)^6\approx\$2251.10`