Question

Shamika's grandmother opens an account with a deposit of $5,000 for Shamika as a

college savings account. The account pays 5 percent annual interest. How much
money will be in the account after 10 years?

A. 8,954.24

B. 8,144.47

C. 8,052.55

D. 7,401.22

Answer 1

9514 1404 393

Answer:

B. $8,144.47

Explanation:

The compound interest formula is ...

A = P(1 +r)^t

where r is the annual rate compounded annually for t years, applied to principal P.

A = $5000(1 +0.05)^10 = $8144.47

After 10 years, there will be $8,144.47 in the account.