Question

Jackie deposits $325 in an account that pays 4.1% interestcompounded annually. How much money will Jackie have in heraccount after 3 years?

Answer 1

In order to determine the money Jackie will have after 3 years, use the following formula for the Interest compound annually:

I = P(1 + r/100)^t

where P is the invested money, t is the time, r is the interest rate per year and I is the interest.

Then, for this case you have:

P = 325

r = 4.1

n = 100

t = 3

By replacing in the formula for I, you obtain:

I = (325)(1 + 4.1/100)³

I = (325)(1.041)³

I = 366.63

Hence, Jackie will have $366.63 after 3 years