Question

Lin opened a savings account that pays 5.25% interest and deposited $5000. If she makes no deposits and no withdrawals for 3 years, how much money will be in her account?

Answer 1

Lin will have approximately $5833.84 in her account after 3 years

Step-by-step explanation:

To calculate the amount of money Lin will have in her account after 3 years, we can use the formula for compound interest:

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

Where:
A is the final amount
P is the principal amount (initial deposit)
r is the annual interest rate (as a decimal)
n is the number of times interest is compounded per year
t is the number of years

Plugging in the given values, we have:
A = 5000(1 + 0.0525/1)^(1*3) = $5833.84

Therefore, after 3 years, Lin will have approximately $5833.84 in her account.

Answer 2

$5829.57

Step-by-step explanation:

Annually compounding interest formula:
`PV(1+i)^t`

5000(1+.0525)^3

5829.567266

which rounds to: 5829.57