Question

A) how much will be occured in at 15 yearsB) what is his profit made of his investment

Answer 1

Laui recieved $16,500 from his grandparents on hus birthday

Principal amount = $16,500

He invested it ina a Roth that earn 8.25% annual report that is compounde annually.

rate of interest = 8.25%

We need to calculate the amount accured in 15 years

Time = 15 years

Expression for the compound interest is :

`\text{ Amount = Principal(}1+\frac{rate\text{ of interst}}{100})^t`

Substitute the value and simplify :

`\begin{gathered} \text{ Amount =16500(1+}(8.25)/(100))^(15) \\ \text{ Amount =16500(}(100+8.25)/(100))^(15) \\ \text{ Amount =16500(}(108.25)/(100))^(15) \\ \text{Amount =}54187.92 \end{gathered}`

The amount will be $54187.92

For the profit : 54187.92 - 16500

Profit amount = 37687.92

Profit percentage = Profit AMount / Cost Price x 100

`\begin{gathered} \text{ Profit Percentage=}(37687.92)/(54187.92)*100 \\ \text{Profit Percentage=}69.55\text{ \%} \end{gathered}`