Question

5. You deposit $300 in an account Urat pays 1.48% annual interest. What is the balance after 1 year if the

interest is compounded daily?
A $304.47
C $368.57
B S301.01
D S301.48
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nrinin ihr nurchased for 35000 that has been​

Answer 1

The correct option is (A) $304.47.

Explanation:

The formula to compute the future value (FV) of an amount (A), compounded daily at an interest rate of r%, for a period of n years is:

`FV=A* [1+(r\%)/(365)]^(n* 365)`

The information provided is:

A = $300

r% = 1.48%

n = 1 year

Compute the future value as follows:

`FV=A* [1+(r\%)/(365)]^(n* 365)`

`=300* [1+(0.0148)/(365)]^(365)\\\\=300* (1.00004055)^(365)\\\\=300* 1.014911\\\\=304.4733\\\\\approx \$304.47`

Thus, the balance after 1 year is $304.47.

The correct option is (A).