Question

An employee put $10.000 in a retirement

account that offers 4%, interest
Compounded annually.
The employee makes no additional deposits or
withdrawals. Which amount is closest to the interest
the employee will have earned at the end of 12 years?

Answer 1

Interest earned after 12 years is $48,000.

Explanation:

The first step is to find 4% of 10,000

10,000 times .4 equals to 4,000

4% of 10,000 is 4,000

So each year, $4,000 is added

Times $4,000 by 12 years and you will have the total interest earned.

In case you need to know, the total amount of the bank account should be $58,000.

I hope this helps! :)