Question

You depisit $2000 in a savings account that has an interest rate of 3% and is a compound annually. Find the total after 2 years. The total after 2 years is $ simplify your answer. Round to the nearest cent as needed)

Answer 1

A = P ( 1 + r )^t

Given A = $2000 , r = 3% = 0.03

so, after 2 years t = 2

A = 2000 * ( 1 + 0.03)^2 = $2,121.8

so, the total after 2 years = $2,121.8

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How much money should be invested today to accumulate to $10,000 in 10 years at 4.5% compounded monthly? (Simplify your answer. Round to the nearest cent as needed)

so, A = $10,000

r = 4.5% = 0.045

t = 10 years = 10 * 12 = 120 months

So, A = P (1 + r/n)^t ,,, n = 12

10,000 = P ( 1 + 0.045/12)^120

10,000 = P * 1.567

P = 10,000/1.567 = 6,381.65 ( to the nearest cent )

so, the money should be invested = $6,381.65