Question

How much money will Alondra make if she invests $900 in an account that pays 8.2% interest compounded annually?

Answer 1

`\$973.80`

Explanation:

The complete question is

How much money will Alondra make if she invests $900 in an account that pays 8.2% interest compounded annually for one year?

we know that

The compound interest formula is equal to

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

where

A is the Final Investment Value

P is the Principal amount of money to be invested

r is the rate of interest in decimal

t is Number of Time Periods

n is the number of times interest is compounded per year

in this problem we have

`t=1\ year\\ P=\$900\\ r=8.2\%=8.2/100=0.082\\n=1`

substitute in the formula above

`A=900(1+(0.082)/(1))^(1*1)`

`A=900(1.082)^(1)`

`A=\$973.80`