Question

Find compound amount $32,350 at 6% compounded annually for 4 years

Answer 1

In order to calculate the compound amount, we can use the following formula for compound interest:

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

Where A is the final amount after t years, P is the principal (initial amount), r is the rate and n is how many times the interest is compounded in a year.

So, for P = 32350, r = 0.06, t = 4 and n = 1, we have:

`\begin{gathered} A=32350(1+0.06)^4 \\ A=32350(1.06)^4 \\ A=32350\cdot1.26247696 \\ A=40841.13 \end{gathered}`

Therefore the amount after 4 years is $40,841.13.