Question

In 2010 Staci invested $13,000 in a savings account for her newborn son. The account pays 4.8% interest each year. Determine the accrued value of the account in the year 2028, when her son will go to college. Round your answer the nearest cent.In the year 2028, the accrued value will be $_________

Answer 1

The accrued value of the account in year 2028 = $24232

Step-by-step explanation:

Amount invested = $13000

rate on the amouht invested = 4.8% = 0.048

To get the value of the account in year 2028, we will add the amount invested to the interest obtained from the simple interest formula:

`\begin{gathered} I\text{ = PRT} \\ P\text{ = \$13000} \\ R\text{ = 0.048} \\ T\text{ = 2028 - 2010} \\ T\text{ = 18 years} \\ \\ I\text{ = 13000 }*\text{ 0.048 }*\text{ 18} \\ I\text{ = \$}11232 \end{gathered}`

The interest after 18 years (2028) = $11232

The accrued value of the account in year 2028 = 13000 + 11232

The accrued value of the account in year 2028 = $24232