Question

Amy invests $10,000 in an account that pays 1% compound interest annually. She uses the expression (1+) to find the total value of the account after years. What will be the total value of the account after 10 years?

Answer 1

Answer: $11046.22

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Work Shown:

P = amount deposited = 10000

r = interest rate in decimal form = 0.01

n = compounding frequency = 1 (annual compounding)

t = number of years = 10

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A = P*(1+r/n)^(n*t) ... compound interest formula

A = 10000*(1+0.01/1)^(1*10)

A = 11046.221254112

A = 11046.22 rounding to the nearest cent