Answer:
Balance = $2806.67
Explanation:
The formula for compound interest is given by:
A(t) = P(1 + r/n)^(nt), where
- A(t) is the amount in the account after t years,
- P is the principal (i.e., the deposit, which is $600 in this case),
- r is the interest rate as a decimal (9.5% becomes 0.095),
- n is the number of compounding periods per year (1 when money is compounded annually),
- and t is the time in years.
Thus, we can plug in 600 for P, 0.095 for r, 1 for n and 17 for t to find A(17), the amount of money in the account after 17 years:
A(17) = 600(1 + 0.095/1)^(17 * 1)
A(17) = 600(1.095)^17
A(17) = 2806.669508
A(17) = 2806.67
Thus, the account will have about $2806.67 in 17 years.