Question

Krystal was given $3000 when she turned 2 years old. Her parents invested at a 2% interest rate compounded annually. No deposits or withdrawals were made. Determine how much money Krystal had in the account when she turned 18.

Answer 1

4131.38

Explanation:

Since it's compounded annually, and no time needs to be converted, we can use the formula
`y=Pe^r^t`, where P is the starting amount, e is Euler's number, r is the rate in decimals, and t is time. The first task would be to find the t. The question set us a timeframe of 2 to 18, so 18-2=16, therefore our t is 16. Plugin the known into the formula and calculate:

`y=3000e^0^.^0^2^*^1^6\\y=3000*e^0^.^3^2\\y=4131.38`