Question

Mark invests $8,008 in a retirement account with a fixed annual interest rate of 2% compounded 6 times per year. What will the account balance be after 16 years?

Please help i need the answer by tomorrow!

Answer 1

Given:

Principal value = $8,008

Rate of interest = 2% compounded 6 times per year.

Time = 16 years

To find:

The account balance after 16 years.

Solution:

The formula for amount is:

`A=P\left(1+(r)/(n)\right)^(nt)`

Where, P is principal, r is the rate of interest, n is the number of times interest compounded in an year and t is the number of years.

Putting
`P=8,008, r=0.02,n=6,t=16` in the above formula, we get

`A=8008\left(1+(0.02)/(6)\right)^(6(16))`

`A=8008\left((6.02)/(6)\right)^(96)`

`A=11022.1721148`

`A\approx 11022.17`

Therefore, the account balance after 16 years is $11022.17.