Question

You start an account with $2500 and an interest rate of 6.5% compounded yearly . How much is in the account after 7 years?​

Answer 1

$3884.97

Explanation:

Because compounding occurs only yearly here, we can use the simplest Compound Amout formula:

A = P(1 + r)^t, where r is the interest rate as a decimal fraction.

Here, A = $2500(1 + 0.065)^7, or

A + $2500(1.065)^7 = $3884.97