Question

I NEED HELP PLEASE, THANKS! :) Heather invests $4,900 in an account with a 3.5% interest rate, making no other deposits or withdrawals. What will Heather’s account balance be after 5 years if the interest is compounded 2 times each year? (SHOW WORK)

Answer 1

Answer: $5,828.28

Explanation:

Use the Compound Interest formula:
`A=P(1+(r)/(n))^(nt)` where

• A is the accrued amount (balance)
• P is the principal (initial amount invested)
• r is the interest rate (in decimal form)
• n is the number of times compounded each year
• t is the time of the investment (in years)

Given: P = 4,900

r = 3.5% (0.035)

n = 2

t = 5

`A=4,900\bigg(1+(0.035)/(2)\bigg)^(2(5))\\\\\\.\qquad = 4900(1.0175)^(10)\\\\\\.\qquad = \large\boxed{5,828.28}\\`