Question

8,370 is deposited into an account that earns 5 1/2 compound interest, compounded annually, for 10 years. What is the total balance after 10 years?

Answer 1

`\text{total balance is 14297.17}`Step-by-step explanation:

amount depsited = P = 8370

rate = 5 1/2 = 5.5%

rate = 0.055

n = compounded annually

time = 10 year

Using compound interest formula:

`FV\text{ = P(1 +}(r)/(n))^(nt)`

insert the values into the formual:

`\begin{gathered} FV\text{ = 8370(1 + }(0.055)/(1))^(1*10) \\ FV\text{ = 8370(1}.055)^(10) \end{gathered}`
`\begin{gathered} FV\text{ = 1}4297.17\text{ } \\ \\ \text{Hence, the total after 10 years is 14297.17} \end{gathered}`