Question

Anna put $500 into a savings account and made no more deposits or withdrawals. The account earns 2% simple interest per year. How much money will be in the account after 5 years?​

Answer 1

$552.04

Explanation:

Lauren, use the compound amount formula: A = P(1 + r)^n.

Here P is the principal and is $500; r is the annual interest rate as a decimal fraction, and n is the number of years.

After 5 years, Anna will have: $500(1 + 0.02)^5 = $552.04