To calculate the future value of an investment compounded annually, we can use the formula:
Future Value = Principal × (1 + Interest Rate)^Time
In this case, the principal is $4900, the interest rate is 5.5% (or 0.055 as a decimal), and the time is 7 years. Plugging in these values into the formula, we can calculate the future value:
Future Value = $4900 × (1 + 0.055)^7
Using a calculator, the approximate future value after rounding to the nearest dollar is $6,766.