Question

Brody deposited $500 into an account that earns 4.2% interest compounded annually. He makes no additional deposits and no withdrawals. How much interest will the account have earned after 7 years?

A $167
B $420
C $542
D $665

Explain correctly. No nonsense, please.

Thank you

Answer 1

The answer is A $ 167

I=pr^t-p
I=500(104.2/100)^7-500
I=500(1.042^7-1)
I=$167.00 to nearest dollar