Question

Bruce takes out a personal loan of $1,000 to go on a trip to Florida. His loan has an annual compound interest rate of 10%. The loan compounds once each year. When you calculate Bruce's debt, be sure to use the formula for annual compound interest. A = P (1+StartFraction r Over n EndFraction)nt Bruce borrowed $1,000 for his trip. If Bruce waits for five years to begin paying back his loan, how much will he owe? $1,251.10 $1,310.21 $1,610.51 $1,810.71

Answer 1

1610.51 $

Explanation:

Answer 2

Answer: He will owe $1610.51 .

Explanation:

Given: Loan amount (P)= $1,000

Rate of interest (r) = 10% = 0.10

Number of years (t)= 5 years

n= 1 (will pay once in a year)

Formula:
`A= P(1+(r)/(n))^(nt)`

`A=1000(1+0.10)^5`

`=1000(1.10)^5\\\\=1000(1.61051)\\\\ =1610.51`

Hence, He will owe $1610.51 .