Question

A principal of $500 is deposited in an account that pays 7% annual interest compounded yearly. Find thebalance after 10 years. Y=C(1+r)^t ( the t is floating btw)

Answer 1

We can find the balance after t years in the account by means of the following formula:

`Y=C(1+r)^t`

Where C is the initial amount deposited in the account

r is the interest rate as a decimal number

t is the year

In this case, C equals $500, r is 0.07 (7%) and t equals 10.

Replacing these values into the above formula, we get:

`Y=500(1+0.07)^(10)=983.6`

Then the total amount of money in the account after 10 years equals $983.6