Question

Mrs. smith has $1500 in a retirement account earning 5% interest. each year she makes an additional deposit of $500 to her account. after 3 years, what would her account balance be?

Answer 1

$3,312.69

Explanation:

What she started with: $1500

Year 1: 1500 + 1500(.05) + 500 = $2,075

Year 2: (2.075)1.05 + 500 = $2,678.75

Year 3: (2678.75)1.05 + 500 = $3,312.69