Question

You deposit $200 in an account earning 3% interest compounded

annually. How much will you have in the account in 10 years?

Answer 1

$268.78

Explanation:

We will use the compound interest formula to solve this:

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

P = initial balance

r = interest rate (decimal)

n = number of times compounded annually

t = time

First, change 3% into its decimal form:

3% ->
`(3)/(100)` -> 0.03

Now, plug in the values:

`A=200(1+(0.03)/(1))^(1(10))`

`A=268.78`

After 10 years, you will have $268.78